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Bush Nominates Kellogg CEO As New Secretary of Commerce

By Richard W. Stevenson

The New York Times -- WASHINGTON

President Bush on Monday nominated Carlos M. Gutierrez, among the most prominent Hispanic business executives in the United States, to be his new commerce secretary, as the president continued with what Republicans said would be a broad overhaul of his Cabinet.

Gutierrez, 51, has been chief executive of the Kellogg Co., the cereal maker, for more than five years, and has built a reputation as an innovative and forceful business leader with broad international experience. But he has little background in public policy, leaving him largely unknown in political circles and untested by the demands of a high-profile job in Washington.

“He understands the world of business, from the first rung on the ladder to the very top,” Bush said, with Gutierrez at his side in the Roosevelt Room at the White House. “He knows exactly what it takes to help American businesses grow and to create jobs.”

In announcing his choice, Bush continued a comprehensive reshaping of his team as he prepares for his second term. Six Cabinet secretaries have already resigned, and one person with close ties to the White House said that Republicans had been told to expect as many as half a dozen additional departures.

Tom Ridge, the homeland security secretary, is likely to step aside, but not until the White House lines up a successor, associates of Ridge said. At a time when the administration is preparing big pushes on Bush’s plans to remake Social Security and the tax code, there has been growing talk in Republican circles that the senior member of the economic team, Treasury Secretary John W. Snow, might leave in the first half of next year, if not sooner. White House officials have made no effort to discourage speculation that Norman Y. Mineta, the transportation secretary and the Cabinet’s only Democrat, will resign soon.

Gutierrez, whose nomination is subject to Senate confirmation, would replace Donald L. Evans, a close friend and political counselor to Bush. Evans announced this month that he was leaving Washington to return home to Texas.

Assuming he is confirmed, taking his new job will entail a significant pay cut for Gutierrez. Last year he was paid $7.4 million by Kellogg in total compensation, including salary, bonus and incentive payments. He owns or has option rights to 2 million shares of company stock. Cabinet secretaries earned an annual salary of $175,700 this year.

The change at the Commerce Department is just one of many among the president’s economic team. N. Gregory Mankiw, the chairman of the White House’s Council of Economic Advisers, is expected to leave within months to return to his professorship at Harvard. Stephen Friedman, the former Wall Street executive who has been director of the National Economic Council for two years, announced last week that he would resign.