Bloomberg News

Chicago Billionaire Pritzker Confirmed as Commerce Chief

June 25, 2013

Chicago Billionaire Pritzker Confirmed as Commerce Chief

Chicago billionaire Penny Pritzker testifies at a Senate Commerce, Science and Transportation Committee hearing on her nomination as Commerce secretary in Washington, D.C., on May 23, 2013. Photographer: Pete Marovich/Bloomberg

Chicago billionaire Penny Pritzker was confirmed as Commerce secretary on a 97-1 Senate vote, elevating a significant figure behind President Barack Obama’s political rise to a position in his second-term Cabinet.

Pritzker, 54, is a top Democratic donor who helped lead Obama to record fundraising levels as the finance chairman of his 2008 campaign. Senate Republicans had indicated she could encounter a tough confirmation hearing focused on her offshore investments and role in the 2001 collapse of Illinois’ Superior Bank, a pioneer in the securitization of sub-prime mortgages.

Instead, Republicans including Ron Johnson of Wisconsin and Dan Coats of Indiana said she made a strong impression in one-on-one meetings before the hearing, and most of their questions turned on her views on programs administered by the agency.

Pritzker’s nomination was unanimously recommended to the full Senate by the Commerce, Science and Transportation Committee. The one vote against her confirmation today came from Bernie Sanders, a Vermont independent.

Pritzker would bring business experience to a department with almost 43,000 workers. She has developed a Chicago skyscraper, started a luxury senior housing company and served as chairwoman for a credit-reporting company. She would replace John Bryson, who quit a year ago for health reasons.

Obama today praised the Senate’s action confirming his long-time ally, calling her “one of the most accomplished and highly respected women in business today.”

‘Build Companies’

“She knows what it takes to build companies from the ground up, and she shares my belief in doing everything we can to help businesses and workers succeed and make America a magnet for good jobs,” Obama said in a statement.

The Pritzker family began Hyatt Hotels Corp (H)., placing the new Commerce chief among the wealthiest U.S. cabinet secretaries in history. She will rank with industrialist Andrew Mellon, who served as Treasury secretary during the 1920s.

In a disclosure form last month, Pritzker reported assets of $400 million to $2.2 billion, excluding the value of more than $50 million in Hyatt stock. The Bloomberg Billionaires Index puts her net worth at more than $1.5 billion.

She reported $176.2 million in income last year, her financial disclosure forms show. The figure includes $118.7 million for more than a decade’s worth of consulting on the restructuring of her family’s U.S. trusts and $53.6 million for similar work on accounts based in the Bahamas.

Her annual salary at the helm of the Commerce Department is $199,700 a year.

Offshore Trusts

On her investments, Pritzker told senators she is seeking to change administration of offshore trusts benefiting her and her family to the U.S. She also has said that if confirmed she would divest 221 separate financial holdings and resign from 158 entities -- including her seat on the Hyatt board.

Pritzker testified at the Senate hearing that she planned to be a “bridge between the administration and the business community.”

The new Commerce secretary managed to avoid the political fights that have stymied some of Obama’s other Cabinet nominees. Senate Majority Leader Harry Reid, a Nevada Democrat, is delaying until July consideration of several nominations that have triggered Republican opposition and led some Democrats to say they want to change filibuster rules to expedite confirmations.

The stalled nominees include Thomas Perez to oversee the Labor Department, Gina McCarthy as administrator of the Environmental Protection Agency, Richard Cordray as director of the Consumer Financial Protection Bureau, and five people selected for the National Labor Relations Board. Cordray is serving as head of the consumer protection bureau under a recess appointment.

To contact the reporter on this story: Laura Litvan in Washington at llitvan@bloomberg.net

To contact the editor responsible for this story: Jodi Schneider at jschneider50@bloomberg.net


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