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He's Selling The Free Market To The World


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HE'S SELLING THE FREE MARKET TO THE WORLD

Bob Zoellick's office hardly looks like an incubator for George Bush's New World Order. True, the coffee table in the seventh-floor quarters of the State Dept. Counselor displays such required reading matter as Foreign Affairs. But it also bears a Harvard Lampoon parody of Time and a picture book on rat-eating snakes. And while most of the paneled office walls on State's power corridor are covered with photos of handshakes with Presidents and Prime Ministers, Zoellick's are festooned with kitschy drawings of poker-playing dogs dressed up as humans. And that's no pinstriped blue blood behind the desk. The 37-year-old Zoellick, who looks more like a clerk than a diplomat, is perfectly comfortable wearing the tie clasp his father received for 20 years of service as a phone-company supervisor. "A lot of people in Washington take themselves too seriously all the time," he says.

But don't be fooled. Impish humor aside, Robert Bruce Zoellick is all business. In a scant two years, Zoellick has parlayed his role as a top adviser to Secretary of State James A. Baker III into a career's worth of foreign policy accomplishments. And Zoellick is the point man for the Bush team's plan to push U. S.-style free markets and democracy into the vacuum left by the crumbling of the Soviet empire.

MR. INSIDE. Given the influence Zoellick already wields, it seemed a tad anticlimactic in mid-May when the Senate confirmed the Illinois native to a second State job, Under Secretary for Economic & Agricultural Affairs. But for Zoellick, State's top economics post is a public coming out for a classic Mr. Inside. Among the duties he acquires with his new status: preparing the President's agenda for the July economic summit in London.

Zoellick's meteoric rise has caught the attention of old Washington hands. "He's one of the stars of this Administration," says Federal Reserve Chairman Alan Greenspan. Adds Robert Blackwill, a former top National Security Council staffer: "He's simply the most effective person below Cabinet level that I've ever seen." Not that he's always right. His hastily drawn proposal to rebuild the Middle East through a multilateral development bank was shot down by both the White House and Saudi Arabia.

Still, Zoellick's elevation reflects the realization by Bush and Baker that economics will now play as big a role in foreign policy as military concerns did during the cold war. From the problems of Eastern Europe to the tension between haves and have-nots in the Middle East, economic issues are tinder for the world's hot spots. "Economics has come into the foreign policy process as a side operation," Zoellick says. "I want to bring it into the day-to-day processes of foreign policy development."

To Washington's sensitive bureaucratic antennas, those bland words are laden with meaning and menace: Baker's State Dept., the Bush Administration's 900-pound gorilla, is making its move on issues that it has until now left mainly to others--the Treasury and Commerce Depts. and the U. S. Trade Representative. "The message is that Zoellick and State are committed to being players on trade and economics," says a White House official. "Some blood will be spilled while that happens."

Historically, the top economics post at State has gone to heavyweights. Zoellick's predecessors include financier C. Douglas Dillon, who went on to become Treasury Secretary, and lawyer William D. Rogers, who later got the top job at State. But the position waned in importance during the Reagan-Bush years. The last incumbent, Robert McCormack, a former aide to Senator Jesse Helms (R-N. C.), was frozen out of Baker's tight inner circle.

'DETAIL MAN.' The Administration could use some high-powered economic help. Suddenly, the twists and turns of German politics drive global interest rates. And Western Europe sees almost as much of a threat in a flood of refugees fleeing wrecked eastern economies as it did in tanks rolling through the Fulda Gap. To many observers, Secretary Nicholas F. Brady's Treasury Dept. has failed to step up to the challenge.

Zoellick will bring new life to the beat. "He's a rare combination of macro conceptualizer and detail man, policy analyst and politician," says Budget Director Richard G. Darman. Zoellick will retain his Counselor's slot, partly to control the paper flow to Baker and to choose the issues he wants to develop.

It was Darman who put Zoellick onto the policy fast track. The two met at Harvard, where Darman taught at the John F. Kennedy School of Government while Zoellick pursued a law degree and a master's in government. After joining Treasury, where Darman was Deputy Secretary, in 1985, Zoellick caught Baker's eye. By the time George Bush ran for President, Zoellick was working as issues director in the campaign.

AGAINST THE GRAIN. At State, the former marathon runner regularly logs 80-hour workweeks, and his hard-driving style has rubbed some foreign service types the wrong way. But he has made his mark by going against the grain. His first big score came when he forged the Administration's compromise with Capitol Hill ending the contra quagmire in Nicaragua. Zoellick then pushed to elevate the role of economics in U. S.-Soviet discussions. When the Berlin Wall fell, Zoellick ignored experts' predictions of failure and led successful negotiations to keep a unified Germany within NATO.

Zoellick also worked to launch the free-trade-agreement talks with Mexico--and faster than U. S. Trade Representative Carla A. Hills wanted. He sees the Mexico trade talks as a jumping-off point for promoting economic and democratic reform throughout Latin America. And he backs the use of multilateral development banks, similar to the one just established for Eastern Europe, to promote free-market reforms. "The idea is to have the U. S. organize multilateral action to promote our political and economic values," he says. "What I'm doing is classic New World Order stuff."

Zoellick's agenda--pushing multilateral action instead of direct U. S. help--may be no more than an attempt to keep the U. S.'s hand in Europe and elsewhere on the cheap. And it's not yet clear whether Zoellick's brand of architecture will prove durable. For example, his push to revamp U. S.-Japanese relations into a "global partnership" has so far failed to transcend tensions over trade. And critics complain that Zoellick was far too sanguine about the prospects of continuing economic reform in the Soviet Union, failing to anticipate the political crisis that still threatens Mikhail Gorbachev.

Even so, Zoellick has rarely failed at what he has set out to do. And it's already clear that as the U. S. gropes for a way to cope in a world where competition is less military than economic, more of Washington's moves will take shape in Zoellick's seventh-floor office.

RESUME: ROBERT B. ZOELLICK

AGE 37 BORN Evergreen Park, Ill.

1991 Confirmed as Under Secretary of State for Economic

& Agricultural Affairs

1989-91 Counselor, State Dept.

1988 Campaign issues director, George Bush for President

campaign

1985-88 Various positions, Treasury Dept.

1983-85 Vice-president and assistant to the chairman and CEO,

Federal National Mortgage Assn.

1982-83 Law clerk, U.S. Court of Appeals for the D.C. Circuit

DATA: BWBill Javetski in Washington


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