“Economic statecraft has two parts: First, how we harness the forces and use the tools of global economics to strengthen our diplomacy and presence abroad; and second, how we put that diplomacy and presence to work to strengthen our economy at home.”
-Secretary of State Hillary Clinton
A Record of Bolstering U.S. Economic Interests.
According to Bloomberg BusinessWeek, “Clinton has argued that commercial diplomacy and the promotion of trade, long the neglected stepchildren of the foreign policy establishment, are central to U.S. strategic interests… her work as a spokeswoman for American business is a less visible part of her legacy. Yet it may be the most durable.”
An Elevated Importance of Economic Engagement.
As the Center for Strategic and International Studies wrote, Secretary Clinton “has laid out a range of initiatives to promote this change [enhance economic engagement], including updating U.S. foreign policy priorities to put more weight on economic opportunities, beefing up State’s commercial diplomacy capacity, and—perhaps most important—creating better incentives for State officers to excel at economics.” And as Yahoo’s foreign policy blog wrote in 2011, “Clinton has been working hard to beef up the economic bench strength of the State Department, while also mounting a bid for State officials to play a more decisive role in determining U.S. global economics policy.”
Introduced New Organizational Structures.
Through the Quadrennial Diplomacy and Development Review, Secretary Clinton reorganized the State Department to “better address clusters of related issues that need greater attention.” This included creating an Under Secretary For Economic Growth, Energy, and the Environment and appointing the first Chief Economist allowing the Department “to engage effectively with our partners in a world where ‘security is shaped in boardrooms and on trading floors as well as on battlefields.’”
Helped Increase U.S. Exports by 33%.
Helping the Administration reach its goal of doubling U.S. exports by 2014, the Department of State worked with partners across the government to increase U.S. exports by 33%. For the first time in the nation’s history, exports topped $2.1 trillion.
Used Economic Tools to Address Global Security Challenges.
Secretary Clinton helped impose the toughest sanctions in Iran’s history by getting Russia and China—and the United States Congress—on board. Because of this, as Clinton said in a 2012 speech, “Every major importer of Iranian oil has lowered their consumption. All 27 nations of the European Union have joined a boycott. In one year, Iran’s oil exports are down by more than one million barrels a day, costing the Iranian Government at least $3 billion each month.” Because of this economic pressure, Iran has succumbed, for now, agreeing to put its nuclear ambitions on hold and come to the negotiating table.
Helped Grow Exports to China by 50% Over 2 Years.
Secretary Clinton worked closely with Treasury Secretary Geithner to strengthen trade with China. Exports of all good and services to China grew by 50 percent in two years, outpacing the 40 percent increase in the rate of exports to the rest of the world. And 800,000 U.S. jobs depend on exports of goods and services to China.
Reached 15 New Open Skies Agreements With Countries in Every Region of the World.
Under Secretary Clinton, the State Department added 15 new Open Skies agreements, with countries like Japan, Brazil, and Saudi Arabia. The Open Skies agreements increased competition, produced greater trade, and increased tourism through more direct services.
A U.S. Business-Promotion Machine
Bloomberg: Sec. Clinton created a U.S. “Business-Promotion Machine.”
In an article titled “How Hillary Clinton Created a U.S. Business-Promotion Machine,” Bloomberg wrote, “To ensure the State Department keeps its business focus, Clinton has tried to change the way the 69,000-person global bureaucracy operates. In one directive, which she calls the ‘Ambassador-as-CEO’ memo, she ordered embassies to make it a priority to help U.S. businesses win contracts. Science officers now extol American clean-technology companies. Military affairs officers promote U.S. fighter planes.” [Bloomberg, 1/10/13]
Sec. Clinton instructed U.S. embassies to push back on governments that “give state-owned enterprises or local favorites an unfair advantage.”
According to CNN, “Claiming U.S. foreign policy can create American jobs at home, Secretary of State Hillary Clinton Tuesday urged U.S. companies to ‘roll up their sleeves, get out there and engage with the economic opportunities that are emerging across the world.’ Speaking in Washington to the U.S. Global Leadership Coalition—which brings together business leaders from around the country—Clinton said American businesses ‘need to up our game.’ U.S. embassies, she said, have been instructed to stand up for American business interests abroad. ‘When we see governments enact regulations that are an excuse to give state-owned enterprises or local favorites an unfair advantage,’ Clinton said, ‘our embassies push back.’” [CNN, 7/12/11]
$21 billion Boeing purchase by Indonesia’s Lion Air estimated to create 100,000 jobs.
In 2011, at the ASEAN Business and Investment Summit, Sec. Clinton announced a $21.7 billion deal for a supply of 240 new model 737 aircraft between Boeing and Lion Air. The agreement was the largest in Boeing’s history and, according to President Obama, “is going to result in over 100,000 jobs back in the United States of America, over a long period of time.” [Sec. Clinton remarks, 11/18/11]
$100 Million was secured for electric vehicles from Ohio start-up.
“Jobs Diplomacy, though, is not just about giants like Boeing or GE or Caterpillar. We are just as committed – and I want you to be as well – to helping small- and medium-sized businesses. Because after all, that is where most of the jobs are in the United States. For example, when Iceland began looking for help converting its vehicles to electric power, our Embassy championed a dynamic startup from Loveland, Ohio that does this work as well as anyone in the world. And in the end, they won a contract worth $100 million and sold 1,000 electric SUVs.” [Sec. Clinton remarks, 2/21/12]
Swiss Department of Defense was inaugural customer for Virginia’s Aurora Flight Sciences with a $5 million contract.
With support from U.S. diplomats in Bern, Switzerland, Aurora Flight Sciences won an open procurement competition from the Swiss government. The Department of State provided assistance in navigating export controls and permission for lease. [Aurora Flight Sciences, 1/25/12; US Embassy Bern, 1/19/12; Under Secretary Hormats congressional testimony, 3/27/12]
Palo Alto firms got $668 million contract with Australia.
BusinessWeek reported on Secretary Clinton’s support for a contract that Space Systems/Loral signed to provide equipment to create a national broadband network in Australia. According to the story, “Clinton met with former Foreign Minister Kevin Rudd several times to press for the deal.” [Bloomberg BusinessWeek, 1/10/13; spacenews.com, 2/7/12]
Supported trade deal worth more than $80 million between GE and Vietnam.
Using the tools of economic statecraft, the State Department supported project agreements between General Electric and Vietnam worth $80 million. The deal supported American jobs in places like Schenectady, NY. According to State Department statistics, there was a 17 percent increase in exports to Vietnam from 2010 to 2011. [Thanh Nien, 7/10/12]