Ron A. Bloom was at one time, Obama "Car Czar".
Ron Bloom, who helped orchestrate the multibillion-dollar U.S. auto manufacturer bailout, left his post in August, 2011.
Bloom, played an integral role in managing the process that led to the reorganization of General Motors and Chrysler as they teetered on the edge of bankruptcy. In total, the government spent about $80 billion to bail out the companies.
He served as President Barack Obama's car czar from July 2009 through February 2011. During that time, he strongly advocated the idea of saving Chrysler over the objections of some of his colleagues. Later he oversaw General Motors' initial public offering, which reduced the government's stake in the automaker to 26.5 percent from 61 percent.
Bloom also played a key role in the administration's effort to double fuel-economy requirements for automakers to 54.4 miles per gallon by 2025.
Throughout the auto bailout, Republicans frequently knocked Bloom for giving favorable treatment to the United Auto Workers union over investors, who lost billions in the car manufacturers' bankruptcies.
"We've faced many tough choices and dealt with numerous challenges over the past two and a half years -- from restructuring the American auto industry to developing historic fuel efficiency standards," Bloom said in a statement later Tuesday. "I am confident in this Administration’s ability to build on these accomplishments and continue our efforts to revitalize the manufacturing sector."
Obama hailed Bloom's accomplishments during his two and half years in the administration.
"Ron Bloom's leadership and expertise has helped us put America's automakers back on the road to recovery, launch new partnerships to make our manufacturers more competitive, and set aggressive fuel economy standards that will save consumers and businesses money at the pump," Obama said in a statement.
Reason for accepting Obama appointment
When President Obama came into office, Ron Bloom became an aide to Rattner at the Presidential Task Force on the Auto Industry. When Steven Rattner resigned after just five months, Bloom took over as car czar.
In September 2009 Bloom accepted a new position overseeing manufacturing policy for the Obama administration.
Bloom said his decision to join the administration was, in part, the product of a broader sense of engagement and desire to improve the world, which he developed in his Habonim years.
- “That’s part of what I try to do in my work life...That’s one of the things that made me want to work for Obama.”
Ron Bloom's father, Joel Bloom, was born in Brooklynand held many jobs, including selling insurance and working for the Israeli defense ministry. His aunt was a teachers' union leader and a great uncle was a leader in the Hebrew Bakers' Union. Ron Bloom was born in Queens but grew up outside of Philadelphia, where his family had moved in 1969 after his father became director of the science museum and planetarium at the Franklin Institute.
Ron Bloom's parents met at a Habonim summer camp in the 1940s and moved to Israel, intending to make aliyah. Though they changed their minds and moved back to the United States, Habonim remained an integral part of their lives.
- “My parents had always been supportive of doing something that we found meaningful,” Bloom said. “There was always a view that what’s going on in the world matters. We talked politics at the dinner table. Life was about engagement in the world.”
- a progressive Labor Zionist youth movement that emphasizes cultural Judaism, socialism and social justice.
At age 10, Bloom was sent with his two siblings to Camp Galil, a movement-run summer camp near Doylestown, Pa. He returned each season for the next four years and later became a camp counselor.
In May 1979 Ron Bloom wrote an article for Democratic Left, "Fair Share Builds Where Liberals Rarely Tread", which identified him as a member of the Boston local of Democratic Socialist Organizing Committee.
Prior to that he also worked as executive director of the Massachusetts Coalition for Full Employment.
At SEIU, Bloom came to the conclusion that unions lacked the technical skills to negotiate with management teams and their advisers at the bargaining table.
"Unions were being backed into corners by companies and couldn't understand on a sophisticated level, the company's arguments...Labor needed to be armed with the equivalent skills."
Bloom's new mission was to learn the argot of Wall Street.
He went to Harvard Business School, then became an investment banker with Lazard Freres, in New York.
- "He recruited himself to Lazard...He wanted to come to Lazard partly because of Felix [Rohatyn, the firm's senior partner] and partly because of the work we were doing with the unions. Unlike most young bankers, he was fully formed by the time he got here. He worked really hard. He came as a very strong technical analyst. He understood valuation and financial instruments. The fact is he was a 24x7 guy long before that term was ever coined."
One of Bloom and Keilin's first assignments together at Lazard Freres was financially troubled Eastern Airlines.
- Although not much could be done to save Eastern, which was eventually liquidated, Lazard's role led Keilin and Bloom to a landmark assignment representing the pilots' union in its numerous attempts to forge an employee buyout of United Airlines. At the time of the pilots' audacious $6 billion proposal, in 1989, United was the target of a hostile takeover attempt by raider Saul P. Steinberg.
- But with a higher bid, the United employees got the nod from the United board of directors to try to put a deal together to buy the company. Their deal required third-party financing, of course, and in the summer of 1989, Citibank -- the lead underwriter of the bank financing -- told the Lazard deal team its loan syndication effort had failed. The deal fell apart and plunged the capital markets into a credit freeze that persisted for the next four years.
Keilin & Bloom
Soon after the United deal fell apart, Keilin and Bloom left Lazardand set up their own boutique investment advisory business.
They kept pursuing their passion for representing the underdogs, and eventually advised the United pilots again -- for a fee said to be $22 million -- in the successful 1994 United Airlines buyout.
In 1996, after six years at Keilin & Bloom, Ron Bloom took a job as the special assistant to the president of the United Steelworkers, one of his longtime clients.
Breginning in 1996, Ron Bloom served as a Special Assistant to the President of the United Steelworkers of America (USWA) and headed heads the Union’s Corporate Research, Industry Analysis and Pattern Bargaining Department
Bloom represented the Steelworkers during a restructuring of Algoma Steel in Canada, and Gerard says his passion for labor and manufacturing issues was clear.
- "I said, why don't you come work at what you really believe in?...He could play a lead role in bargaining, play a role in a number of different sectors in the economy and shape policy."
Ron Bloom initially served as an adviser to union president George Becker, then after Becker's retirement in 2001 he advised successor Leo Gerard.
Democratic Left article
Based on a remarks delivered to the metal industry’s Steel Success Strategies XXI conference in New York in June 2006, Bloom revealed a strong antipathy to free trade and free markets.
- The Steelworkers have some advice for industry execs on how to make sure there’s plenty for both shareholders and workers. The theme of this advice will be really quite simple – be hard-headed and pragmatic capitalists – run the companies and actively participate in the political process on the basis of what is good for your shareholders – and not based on outmoded nostrums about unions, free enterprise, deregulation, free markets and free trade.
- In today’s world the blather about free trade, free-markets and the joys of competition is nothing but pablum for the suckers. The guys making the real money know that outsized returns are available to those who find the industries that get the system to work for them and the companies within those industries that dominate them.
- The starting point is that companies need to get along with the union. Companies that establish a constructive partnership with their unions do far better for their shareholders than those that do not.
According to Bloom;
- Today the real impediments to long-term profitability lie largely outside the collective bargaining arena...
Bloom listed the four key problem areas and suggested solutions including socialized health care, a centralized national energy policy and protectionist measures for domestic manufacturing.
- Health Care Costs-The first is one where conflicts between labor and management do still exist, and that is health care. On that issue, however, given the fact that the shareholders want us to get along, the answer is to get it out of collective bargaining and into the public sphere. That means that management must support universal single-payer national health care...
- Shrinking Customer Base-It is true that a significant amount of steel is consumed in the construction of infrastructure – roads, bridges, buildings, factories, etc. – things that are specifically anchored where they are built. But almost 80 percent of steel consumption is accounted for by products that can be made anywhere...
- And if those who consume steel are not located here, it will be much harder to sell them steel that is made here. The American steel industry today is globally competitive, but it generally does not have costs low enough to rely on exports for its survival...
- Historically, the industry has focused on the threat from unfairly traded imported steel. And while that threat is real and should continue to be monitored, today the more immediate threat comes from the demand for steel being lost because those who use the steel will use it somewhere else...
- The steel industry, in its own self-interest, needs to broadly engage in the fight to save the overall manufacturing sector. Every other nation in the world has a specific and targeted strategy to preserve or expand its manufacturing base.
- High Energy Costs-Once again, a vital sector of the economy is being run for the benefit of its producers, not its consumers. And while we can waste time arguing about whether to drill in Alaska’s North Slope, real relief will come only from increasing supply and reducing demand, through huge investments in conservation, clean coal, and renewables – all of which will consume lots of steel and none of which will be done by the guys who today are profiting so handsomely from the status-quo.
- The steel industry and manufacturers in general need to stop worrying about offending their business school classmates, political soul mates, and friends at the country club and to stand up for their owners. It is time to support a comprehensive national energy program...
- Exploding Trade Deficit-No one seriously believes that the U.S.’s current profligacy will end other than badly, but neither the steel industry nor any other sector of the business community appears willing to stand up and say that the emperor has no clothes.
- The growth of China and India can be a great opportunity. But not if we, as Lenin so aptly put it, sell them the rope with which to hang us.
- Steel industry managers need to repudiate the race-to-the bottom model of globalization. We need world trade that brings the bottom up, not the top down, and we need to tell the American government to do what every one of its trading partners does – stand up for those who operate on their soil.
Back to Lazard
In February 2012, Bloom become a senior adviser to Lazard.
The investment bank, said Mr. Bloom would provide strategic advice to the firm and its clients.
“Ron’s skills, experience and relationships will be a tremendous complement to our global franchise,” Kenneth M. Jacobs, Lazard’s chief executive, said in the statement.
Since leaving government service in August, 2011, Mr. Bloom had been serving as a senior fellow at the Center for American Progress.
“What I’ve tried to do my whole career is work on situations where there are multiple stakeholders and the solution isn’t obvious, but if people work together, they get a better result,” he said. “That’s very consistent with what Lazard tries to do,”said Bloom.
- Ron Bloom, Obama's Former 'Car Czar,' Leaving White House, First Posted: 08/09/11 03:01 PM ET Updated: 10/09/11 06:12 AM ET
- DealB%k, February 1, 2012, 9:38 am Lazard Hires Ron Bloom as Adviser, By BEN PROTESS