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Trump appoints Wall Street CEO Lutnick to lead USTR, Commerce, and tariffs

Amos Simanungkalit · 20 Nov 202410.2K 閱讀

U.S. President-elect Donald Trump announced on Tuesday his intent to nominate Wall Street CEO Howard Lutnick as head of the Commerce Department, where he will shape the administration’s trade and tariff policies, focusing heavily on China’s tech sector. Lutnick, the CEO of Cantor Fitzgerald, will also have added responsibilities involving the U.S. Trade Representative's office, according to a statement from Trump.

The transition team for Trump did not provide clarity on the scope of Lutnick’s duties or whether he would concurrently serve as U.S. Trade Representative, traditionally a significant role in shaping American trade policy. The USTR reports directly to the president, and oversight for both the Commerce Department and USTR involves different congressional committees.

This appointment positions Lutnick, a long-time ally of Trump who supports his agenda to restore U.S. manufacturing and promote cryptocurrency, in a key economic role. Lutnick also leads brokerage BGC Group and chairs Newmark Group (NASDAQ: NMRK), a commercial real estate services company, and FMX, a trading platform supported by prominent Wall Street banks. Following the announcement, BGC’s stock declined by 2.6%.

Lutnick’s selection represents a setback for two other prominent Trump allies who sought the role: former Small Business Administrator Linda McMahon and ex-USTR Robert Lighthizer. CNN has indicated that McMahon, who co-chaired Trump’s transition team alongside Lutnick, is expected to lead the Department of Education, a department Trump previously proposed eliminating. Lighthizer, who had also been considered for Treasury Secretary, was unavailable for comment.

TRADE PRIORITIES AND FUNCTIONS

The Commerce Department oversees a broad array of areas, including the U.S. Census Bureau, weather forecasting, oceanic navigation, and investment promotion, employing nearly 47,000 people. Its influence on trade policy has expanded recently, notably through its role in enforcing export controls on sensitive technologies that have positioned it at the forefront of trade disputes with China. The department’s trade functions also include investigating anti-dumping and countervailing duty cases, leading to tariffs designed to shield U.S. industries.

Under Trump's previous term, the department leveraged "Section 232" national security measures to impose tariffs on steel and aluminum imports and is considering broad global tariffs based on similar grounds. Trump’s stated aim to reinvigorate U.S. manufacturing through new tariffs—up to 60% on Chinese goods and 10%-20% on other imports—has the potential to disrupt global trade, economists warn.

Amid concerns that American technology could bolster China's military capabilities, both the Trump and Biden administrations have actively used the Commerce Department’s authority to restrict exports of key technologies, with a focus on semiconductors and associated manufacturing equipment. Over recent years, the U.S. has implemented comprehensive controls to prevent China from accessing advanced chips, crucial for artificial intelligence, and tools needed for next-gen semiconductor manufacturing.

A PROPONENT OF TARIFFS

Unlike some of Trump’s close advisors, Lutnick has spoken less publicly about China but has been vocal in his support for tariffs, particularly those targeting Chinese imports. In a podcast, he argued, "Don't tax our people. Make money instead. Put tariffs on China and make $400 billion." Cantor Fitzgerald, which operates offices in Hong Kong, facilitated the Nasdaq IPO for Chinese biotech firm Adlai Nortye last year, marking the first Chinese listing since Beijing’s new rules for overseas public offerings were instituted.

The incoming Commerce Secretary will be responsible for enforcing measures aimed at restricting China's advancements in artificial intelligence and maintaining a technological edge over key competitors such as Huawei Technologies and Semiconductor Manufacturing International.

Lutnick, who has deep roots in New York City’s Long Island suburbs and experience in trading and real estate, has been a prominent advocate for Trump, hosting fundraisers and publicly supporting his policies. As a co-chair of Trump’s transition team, he was frequently mentioned as a potential appointee within the new administration, including as a candidate for Treasury Secretary.