President-elect Donald Trump on Wednesday named billionaire investor Carl Icahn and vocal China critic Peter Navarro as high-level White House advisers, leaning on controversial figures from his campaign to help shape his economic agenda.
Trump announced that Navarro would lead the National Trade Council, a newly created group within the White House that the Trump transition team said would be equivalent to the historically powerful roles of the National Security Council and the National Economic Council. Navarro, a business professor at the University of California at Irvine who has been a sharp critic of globalization and trade with China, will help set strategy in trade negotiations, address the decline in manufacturing jobs and implement Trump’s pledge to “Buy American, hire American.”
Navarro worked closely with commerce secretary nominee and billionaire industrialist Wilbur Ross during the campaign, helping to craft the hard-line approach on trade that propelled Trump to victory. The proposals included ripping up long-standing agreements with Mexico, slapping double-digit tariffs on imports from China and punishing companies that outsource manufacturing jobs.
After the election, comments from some of Trump’s advisers — as well as the president-elect himself — had appeared to indicate that he might moderate his stance. But Navarro's prominent new role could suggest Trump is prepared to follow through on some of his toughest rhetoric regarding free trade during the campaign. Trump has yet to appoint a U.S. trade representative, traditionally the point person in the administration for such policy.
Trump's protectionist stance has drawn a sharp contrast with Republican orthodoxy, which has historically supported open trade. Even some of Trump's campaign advisers — including Larry Kudlow, a potential pick to lead the Council of Economic Advisers — subscribe to more traditional GOP views.
In a statement on Wednesday, Trump said has been influenced by Navarro’s work for years.
“He has presciently documented the harms inflicted by globalism on American workers, and laid out a path forward to restore our middle class,” he said.
Navarro wrote several books blaming China for the hollowing out of America’s middle class and produced a documentary called “Death By China” that was narrated by actor Martin Sheen. Economists have warned that implementing Trump’s policies could ignite a trade war that would undermine the American recovery — possibly even throwing the nation into recession.
“He’s as hard a hard-liner as they come,” said Patrick Chovanec, managing director and chief strategist at Silvercrest Asset Management Group. “All you have to do is watch his movie or read his book. China is the nemesis.”
Glenn Hubbard, dean of Columbia University Business School and former chief economist for President George W. Bush, said Navarro has long been motivated by what he sees as an unfair playing field with China. Navarro is a longtime Democrat and has said he felt abandoned by his party. He and Ross have also proposed using $137 billion in tax credits to stimulate private spending on infrastructure that they estimated would total $1 trillion.
“Peter has a set of ideas in which he’s interested,” Hubbard said. “Politicians use conservative or liberal labels. … Peter found a political leader who was very interested in his ideas.”
Icahn, one of a handful of hedge fund investors who supported Trump’s during his campaign, will serve as a special adviser overseeing regulatory reform. The role as described is unusual — the transition team said he would not be a government employee and would have no specific duties.
Icahn has expressed skepticism of many environmental regulations. However, he has defended the sweeping financial reforms passed after the Great Recession that Trump has pledged to dismantle.
Icahn has had a hand in shaping Trump’s economic agenda from the start — at times in ways that benefited his own investments. One of Icahn’s companies, for example, owns two oil refineries that may have to pay more than $200 million because of a congressionally mandated program designed to promote the blending of ethanol with gasoline.
In a September interview, Icahn told The Washington Post: “Sure, I have an agenda. George Washington had an agenda, too,” citing the Founding Father’s land holdings. “But having an agenda doesn’t mean you’re not doing the right thing.”
The renewable fuel program, administered by the Environmental Protection Agency, establishes renewable fuel certificates, and many big oil companies have been earning substantial profits while independent refiners struggle. “The EPA is doing for Big Oil what it could never do for themselves: get rid of all the competitors in the refining business,” Icahn said.
Trump also claimed victory Wednesday after meeting with Boeing chief executive Dennis Muilenburg. In a tweet, Trump had complained that Boeing’s price tag for Air Force One was too high. Muilenburg said Wednesday that the company would “get it done for less” than the $4 billion Trump had indicated it would cost.
“We work on Air Force One because it’s important to our country, and we’re going to make sure that he gets the best capability and that it’s done affordably,” he said.