House Committee Investigating Transportation Secretary Elaine Chao, Wife of Moscow Mitch, for Using Her Position for Personal and Family Profit

September 17th 2019

Elaine Chao- Fortune Brainstorm Tech 2018 ( Fortune Brainstorm Tech 2018 )

Elaine Chao- Fortune Brainstorm Tech 2018 (Fortune Brainstorm Tech 2018)

By Joan McCarter

Daily Kos

The House Oversight and Reform Committee has asked Transportation Secretary Elaine Chao to provide documents relating to her family's shipping company, The New York Times reports. The committee is investigating whether she has acted in her capacity as transportation secretary to benefit herself and her family, which includes her husband, Senate Majority Leader Mitch McConnell.

The committee is investigating communications between the Transportation Department and Foremost Group, the shipping company owned by her family and headed up by her sister, which have been part of a Times investigation that found "numerous instances in which Ms. Chao, as transportation secretary, may have boosted Foremost’s image." Chao has made multiple joint appearances with her father, James Chao, who founded the company, since she became the department's secretary, essentially under the auspices of the department. She and her father have conducted interviews with Chinese-language reporters standing in front of the logo and the flag of the Transportation Department, and she appeared at a signing ceremony celebrating an agreement between Foremost and a Japanese company that has mass transit projects in the U.S., overseen by her department. A spokesman for the department told the Times that these "were just routine family events." Like all our families do.

Chao had also planned a 2017 trip to China with her father to meet government officials there. Foremost has secured a loan commitment for hundreds of millions of dollars from a bank run by the Chinese government. That trip was nixed by the State Department because of ethics concerns—she was proposing to bring family members to meetings with Chinese government officials. The committee has asked for all the documentation into the planning of this trip.

The request cites efforts by Chao to cut grant programs specifically designated for boosting the U.S. maritime industry. In 2017 and 2018, the department proposed the cuts, which the Times says "could have undermined the American maritime industry at the same time her family’s company was receiving support from the Chinese maritime industry." The cuts were rejected by Congress.

The committee also wants documentation about her failure to sell stocks in Vulcan Materials, a company that manufactures road construction materials, until this summer, after publication of reports that she was still earning on her shares after she had signed an ethics agreement in 2017 to divest from the company. That was just an "oversight," the agency spokesperson said. An oversight worth something like $400,000 in stocks for Chao. All in all, the committee submitted 18 separate document and information requests related to both Foremost and Vulcan.

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