Space commerce: ‘Bankruptcy king’ Wilbur Ross is latest Trump aide to talk recovery in Pa.
U.S. Secretary of Commerce Wilbur Ross visited Exton on Thursday to promote the "Commercial Space Program" and also "answer questions about the economy in Pennsylvania and the U.S." during the coronavirus pandemic.
Washington isn’t likely to extend the special $600-a-week federal unemployment benefit that expires in July, but President Donald Trump still hopes to pass his long-delayed, trillion-dollar infrastructure program soon, U.S. Commerce Secretary Wilbur Ross said on a visit to a federal space contractor in Exton on Thursday.
With the government facing a record budget deficit from the money it is spending and the taxes it no longer collects, Senate Republicans have said they are reluctant to spend much more after passing the $2.3 trillion CARES Act and other bills Trump signed this spring. Those efforts were meant to keep the economy growing despite the coronavirus shutdowns and a global drop in trade.
But infrastructure is a priority for Trump, who is facing a reelection fight, and he has lately sent Ross and other members of his administration into Pennsylvania and other battleground states to sell his agenda.
“Infrastructure has been a campaign promise from way back in 2016,” said Ross, in the Commercial Space Operations Center, which tracks satellites and “space junk” for government and military agencies and corporate clients.
The center sits atop the Exton headquarters of 221-employee Analytical Graphics Inc. (AGI), a software firm that hopes to win more business as Elon Musk’s SpaceX and other commercial companies pop more satellites into orbit.
Because of the coronavirus and other “diversions,” Trump’s infrastructure effort has “slowed down,” Ross acknowledged. “But infrastructure is important independent of its stimulative impact. Our airports are a disgrace, many of our ports are a disgrace, our highways need to be repaired, we need 5G broadband,” Ross told reporters in a brief question-and-answer session.
“We really have huge deferred-maintenance and deferred-operations needs,” he added, noting that improved broadband “is going to be transformative of everybody’s economy.” He confirmed that the administration remained determined to lock out China-based broadband developer Huawei, which faces federal fraud indictments.
Ross also said that temporary federal unemployment benefits make it financially unattractive for millions of workers to return to their jobs for less than $15 an hour. Even so, he said, recent visits to Southern states have convinced him that restaurant and hotel workers are returning because “people are feeling more secure having a job, as opposed to getting an unemployment supplement that will probably go away in 45 days.”
He pointed to the unexpectedly strong May surge in retail sales as a sign that the underlying economy is strong and can bounce back quickly. May sales were up about 17%, after dropping 14% in April and 8% in March. Still, the May receipts remained 5% below last May’s pre-coronavirus levels.
Ross said stimulus payments, “forgivable” small-business loans, and the extra unemployment checks have all boosted consumers.
The commerce chief spoke after he and other federal officials, including the local congresswoman, U.S. Rep. Chrissy Houlahan (D., Pa.), an Air Force veteran, were given a tour and summary of AGI facilities by chief executive Paul Graziani, who founded the company in the early 1990s with a small group of General Electric colleagues.
The group has developed software to track the proliferating satellites and debris in space, advising clients — including U.S. government agencies and commercial companies — of impending collisions and how to avoid them.
Graziani and his colleagues said AGI uses a mix of data from telescopes, satellites, airborne GPS systems, and other sources to make projections that are sometimes more current and detailed than U.S. government tracking systems.
The executive said private companies use more data and install systems faster than some military-owned systems because they are unhampered by government contracting rules or by standards that may require all sensors to be strictly accurate. It can be more useful to take readings for a wider range of sensors and throw away the outliers, as some AGI readings do.
Ross, 82, nicknamed the “Bankruptcy King,” has a history of turning around troubled companies, including some active in the Philadelphia area. His reorganization of bankrupt Bethlehem Steel, after the company froze pensions for thousands of workers, delivered historic steel mills in Coatesville and Conshohocken to their current owner, ArcelorMittal, which has deferred upgrades and cut employment at both plants.
Ross also invested in troubled banks during the Great Recession, rescuing the Brown family’s South Jersey-based Sun National Bank, before selling it in 2018.
But, as he recounted Thursday, Ross took a pass on investing in Moorestown banker Vernon Hill’s MetroBank Plc when it opened in 2010, though several of his friends, including real estate developer Richard LeFrak, got in early.
LeFrak “made money on that deal,” exiting with a profit before the stock lost most of its value and Hill stepped down from the chairman’s post last year. “I wish I had joined [LeFrak] in that investment,” Ross said, smiling.