Commerce Secretary Reflects On Service As a new administration heads to Washington, Cabinet leaders serving under President Bush are packing up their offices. Among them is Commerce Secretary Carlos Gutierrez. The secretary reflects on his role, shares departing thoughts on the current economic crisis and discusses his legacy.
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Commerce Secretary Reflects On Service

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Commerce Secretary Reflects On Service

Commerce Secretary Reflects On Service

Commerce Secretary Reflects On Service

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As a new administration heads to Washington, Cabinet leaders serving under President Bush are packing up their offices. Among them is Commerce Secretary Carlos Gutierrez. The secretary reflects on his role, shares departing thoughts on the current economic crisis and discusses his legacy.

Carlos Gutierrez is a former CEO of the Kellogg Company, one of only a few Latinos to lead a Fortune 1000 company. MANDEL NGAN/AFP/Getty Images hide caption

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I'm Michel Martin, and this is Tell Me More from NPR News. Coming up, the battle over the telenovelas. An epic fight is playing out in a Los Angeles courtroom between Univision and the Mexican company that supplies some of its most popular programming. It's a case that could dramatically affect the Spanish-language media world, and we'll tell you about it in just a few minutes.

But first, a newsmaker interview and an exit interview all at the same time with outgoing Commerce Secretary Carlos Gutierrez. Before taking the post in 2005, Gutierrez was CEO of the Kellogg Company, the cereal giant. He was not only the youngest CEO in the company's history but also one of a handful of Latino power players at a Fortune 1000 company.

As commerce secretary, Gutierrez has been tasked with trying to enhance trade and promote U.S. exports. He's also been involved in U.S-Cuba policy, serving as co-chair for the Commission for Assistance to a Free Cuba, a Cabinet-level position to help ease the democratic transition in that nation. He's with us now in our Washington, D.C. studios. Welcome. Thank you so much for stopping in.

Secretary CARLOS GUTIERREZ (Department of Commerce): Pleasure to be here. Thank you.

MARTIN: Secretary, let's jump right into the economy. When you took the job in February 2005, a very different situation - housing bloom in full swing, stock portfolios robust. Now we are in the midst of a deep recession. Did you think when you took this job that part of it would be talking about bailing out the banks, the automakers, mortgage companies?

Secretary GUTIERREZ: No, I don't think anyone saw that. In fact, I recall when I came in February of 2005 just how great the numbers were, and I just felt that we weren't getting the message out as loud and clear as we could be. But we had come off a recession, we had come off 9/11, we were growing jobs, growing our GDP at a faster rate than any other G7 economy. So it's been quite a change.

I do believe that this would have happened regardless who would have been in office because we're talking about something that probably started 15, 20 years ago. And I'm very pleased that the president acted the way he did. He was decisive, and that means a lot of the problems that surfaced this year will not be around next year.

MARTIN: Well, talk me about that, why you think this is something that would have happened no matter who is in office because one of the critical factors in this recession is the collapse of the housing industry, and one of the factors in that collapse, to some minds, was this over-reliance on subprime mortgages which, you know, were being pushed to people who could not afford them. And many people say that that is a regulatory issue, which is clearly a matter of governance. What do you say?

Secretary GUTIERREZ: Well, you know, the irony is - and I will say this because I know the president doesn't like to talk about this - but as an administration, we actually made about 17 different attempts to regulate Fannie and Freddie more, to put caps on their lending just to ensure that it wasn't continuing to grow in a fashion that appeared to be growing out of control. But, you know, if you go back to the early '90s...

MARTIN: But forgive me, Fannie and Freddie have a minority of the subprime market out there. In fact, a percentage of their portfolios, their percentage of subprimes is lower than it is for all these private lenders. So - but if you could address the question of oversight.

Secretary GUTIERREZ: They did play a very significant role in boosting the housing market because a lot of it was boosted by the paper that people were selling. It's not ironic but it almost came to the point where it wasn't about selling homes as the end, but selling homes was a means to be able to get paper that then would be pushed through the system.

But you know, since the early '90s, we have had the goal of increasing home ownership. We had a combination of very low interest rates at a time when disposable income was growing. And then in 2005, interestingly, this innovation of these mortgage-backed securities arose, and that just really fueled it even more. So you know, so many people have been very genuine and have admitted, we did not see this coming to the extent that it happened. And this is one of those unexpected crises, and then it comes down to who is going to deal with that and how.

MARTIN: The president has been asked this question so I'd like to ask you this question. When you look back on it, is there anything you wish you had done differently to minimize this situation or to forestall it?

Secretary GUTIERREZ: Well, I think, as others, I wish I would have had the - sort of the crystal ball to see it coming. But the next president will not have to deal with Bear Stearns. They will not have to deal with Lehman. They will not have to deal with Citigroup. They will not have to deal with Goldman Sachs. They will not have to deal with AIG. A lot of these problems that were confronted, that were dealt with in a very dramatic fashion, I think that is the tremendous legacy of the president, is being able to see a problem and then confront it, which is what he does so well. And I believe that history will give him credit for being incredibly courageous and decisive.

MARTIN: If you're just joining us, you're listening to Tell Me More from NPR News. We're speaking with Carlos Gutierrez, the outgoing secretary of commerce. Can we go back for a minute and ask, why did you want to take this job? At the time, as I mentioned, you had a very visible position as CEO of a major corporation and a history-making position, in a way. Why did you want to be commerce secretary?

Secretary GUTIERREZ: Well, I actually didn't. I wasn't pursuing the job. I received one of those phone calls that you get once in a lifetime. I had been at Kellogg for 30 years. I had been CEO for almost six years, and I just felt like it was such an incredible opportunity to serve a president who I admire, to serve a country that has given me so much. I took a 95 percent pay cut...

(Soundbite of laughter)

Secretary GUTIERREZ: And I would do it again. It's just been the greatest experience of my life.

MARTIN: On the other hand, there are those who would like to have seen you be more visible in this job. For example, Chicago Tribune's chief business correspondent, David Greising, said this in a column - rather pointed, but he wrote: A singularly weak Commerce Secretary Carlos Gutierrez has allowed Treasure Secretary Henry Paulson to control the government's response to the economic crisis, even as focus shifted to the auto industry. Commerce should take the lead in that.

How do you respond to that?

Secretary GUTIERREZ: It's interesting. It's the first time I've heard that. You know, we are a $6 billion department, and to suggest that the best way to serve the president is to try to compete with the Treasury Department is not only foolish but I think it would defeat the purpose of actually working for the country and contributing to the administration. I think we've been tremendously visible. I think we've been out there in the economy. Actually, we did a tremendous amount of work on the autos where it counts, you know, in the rooms where decisions are being made and where recommendations are being made.

I respect everyone's opinion, but I think you'll find that a good majority - I would say nine out of 10 people would characterize my 10 years being one of great success and actually of changing the perception of the Commerce Department as being one where it is an advocate for business.

MARTIN: President-elect Obama has gotten some criticism in the blogosphere and among some - mainly Latino commentators about whether he's giving people of Latino heritage enough prominence in this administration, in his upcoming administration. Do you have an opinion about that?

Secretary GUTIERREZ: There have been a couple of appointments or nominations. Obviously, Senator Salazar, who's - who I have a great deal of respect for - for interior; Solis for labor. And I think those are two very important appointments. It seems to me to be a very diverse Cabinet. Now I say that proudly, coming from what I think is probably the most diverse Cabinet there's been. The president doesn't talk a lot about this. He doesn't tend to brag. But you name it, we have people of all different races and backgrounds and genders, and it really has been a finely(ph) diverse Cabinet. But I think that the president-elect has also done a very good job in ensuring that he has a diverse set of opinions and a very diverse group.

MARTIN: As everyone knows, Bill Richardson, the governor of New Mexico, had been tapped to succeed you. He's since withdrawn because of an ongoing investigation to how a political contributor won state business. But what qualities do you think are needed given the challenges that we face in the person who succeeds you?

Secretary GUTIERREZ: I would say management's leadership, which I think is required in any Cabinet-level position, specifically in commerce. The awareness of the importance of world trade, the world economy is absolutely essential because so much of what we do is to advocate for businesses and promote trade. And then, as I mentioned before, a knowledge of business, how business works, how business people think, what business people need, what kind of an environment do businesses need to create jobs and to grow and to prosper because our economy really does rely on the private sector for growth.

MARTIN: Mr. Secretary, Cuba, two weeks ago, marked 50 years since the Cuban revolution toppled the Batista regime and thrust Fidel Castro into power. As co-chair of the president's Commission for Assistance to a Free Cuba along with Secretary of State Condeleezza Rice, I'd like to ask you, many people are arguing it's time to change the policy. Fifty years of the same policy has not achieved democracy in Cuba, and they say it's time for a change. What do you say to that?

Secretary GUTIERREZ: The purpose of the policy has always been to deny resources to a regime that has been, unfortunately, a declared enemy of the U.S. for 50 years because whenever they've had resources, they've never used it to improve the lives of the average Cuban. They've used it to expand their military, to send a military to Africa, to support guerrilla movements in Latin America. And from that standpoint, I would say the embargo has been tremendously successful. It has denied Castro resources, and I'd hate to think what our hemisphere would be like if Castro had the type of resources that other dictators have had.

MARTIN: OK, but he's an old sick man now, and his brother is not much younger.

Secretary GUTIERREZ: Well, his brother has been the longest-serving minister of defense in the world, is very much of the same ideology. I suppose that time will tell whether his brother is different or not. I would just say this, that the question is often asked about when are we going to change our policy? And I think the question should be when is Cuba going to change its system?

MARTIN: Well, speaking of change, what's next for you?

Secretary GUTIERREZ: I'll probably go back to the private sector, although I'll tell you, I'd like to stay very much engaged in the public sector. I want to stay engaged in policy. There are areas that - as you mentioned, Cuba, that I have a lot passion for. Immigration is another area, business, trade. So whatever I do, I want to stay close to Washington, D.C. and public policy.

MARTIN: Secretary of Commerce Carlos Gutierrez was kind enough to join us in our Washington, D.C. studios. Mr. Secretary, thank you so much for speaking with us.

Secretary GUTIERREZ: Thank you. Appreciate it.

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