Bloom in Charge, Question Mark

By August 21, 2009Economy, Trade

From Bloomberg, “Obama May Tap Auto Chief Bloom to Craft Manufacturing Policy“:

Aug. 20 (Bloomberg) — The Obama administration may elevate Ron Bloom, head of the government’s auto task force, to a job that would set U.S. manufacturing policy more broadly, people familiar with the matter said.

Bloom, a former United Steelworkers union adviser and Lazard Ltd. investment banker, helped guide General Motors Co. and Chrysler Group LLC through bankruptcy as part of the government’s rescue of the auto industry. The task force will continue, and it hasn’t been decided whether Bloom will remain its leader while taking on the new role, the people said.

We’re all for focused attention on the manufacturing economy, but (and these are personal musings)…

Another czar? A union-official-investment-banker-negotiator czar? You would think it would make sense to name someone like a manufacturer to help coordinate manufacturing policy.

Or let the Department of Commerce do its job. The trouble with czars is their unaccountability, lack of transparency, and lack of transparent accountability.

And the potential for favoritism and caprice. “Nah, you can’t touch that company. They’re all czarred up.”

You’d also have to think U.S. Trade Representative Ron Kirk, Commerce Secretary Locke, and others who have made the case for trade and exports would also take note of a former Steelworkers official being put in charge of manufacturing policy.

But it’s a trial balloon. So we’ll read up on Mr. Bloom while its shadows slowly move across the sultry summer landscape.

Wall Street Journal, Real Time Economics blog, February 19, 2009, “Who Is Ron Bloom?

The Nation, February 16, 2009, “Labor’s Man Joins Treasury Team.”

Ron Bloom has the sophistication of a Wall Street financier, but the head and heart of a labor guy. He knows how to “run the numbers” and do deals, techniques he learned years ago at Lazard Frères. When he left the world of capital, however, he went to work for organized labor. Bloom steers capital strategies for the steelworkers and advises Leo Gerard, the union’s heads-up president. The steelworkers have been in the vanguard of unions aggressively using their financial power–the invested capital of pension funds–to force reform and worker-friendly policies on the corporate world. These are always tough fights. It takes smart strategies and hard-nosed negotiating to prevail. Bloom and Gerard have developed a “rep” for both.

United Steelworkers news release, February 17, 2009, excerpt:

The administration was lucky to find a person who so deeply believes in organized labor and so clearly understands corporate finance, [USW President Leo] Gerard said. “Saving the domestic auto industry is crucial to the economic renewal of the U.S.” said Gerard. “The steel, glass, auto parts, tires, and paper industries produce products for this industry and employ a quarter million of our members alone.”

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