News & Politics

Trump's Latest Cabinet Pick Sets Up a Conflict-of-Interest Extraordinaire

Elaine Chao's family runs a global shipping business, and she is Mitch McConnell's wife. How cozy is that!

Photo Credit: Patrick Delahanty, Flickr

President-elect Donald Trump has chosen Elaine Chao as his transportation secretary. Chao served as secretary of labor from 2001 to 2009, under President George W. Bush. She is the wife of Senate Majority Leader Mitch McConnell.

The appointment of Chao to this position is striking for at least one major reason: her family owns a major international shipping company. Chao's father, James Chao, is the chairman of the Foremost Group, which he founded in 1964. Elaine Chao's sister Angela is currently the deputy chairman of the company. Chao's father began donating to McConnell in the 1980s. In 2008 he gave Chao and McConnell $5 million to $25 million, giving a huge boost to McConnell's personal worth.

Foremost purchases vessels and coordinates the shipment of commodities throughout the globe. In 2014, the Nation's Lee Fang reported that 90 pounds of cocaine was seized by the Colombian Coast Guard from a vessel owned by Foremost. Fang reported that:  

The firm...leaves a faint online trace. Foremost’s website is blank. Records and court documents obtained by The Nation show that the ownership of the company’s vessels—with names such as Ping MaySoya MayFu May and Grain May—is obscured through a byzantine structure of tax entities. 

A 2014 report from the Louisville Courant revealed that Chao registers his ships in Liberia to avoid paying taxes in the United States.

One of the agencies under control of the Transportation Department is the United States Maritime Administration.

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Michael Arria covers labor and social movements. Follow him on Twitter: @michaelarria