Why He Matters
Bloom has built a strong reputation in labor circles as an expert negotiator and former special assistant to the president of the United Steelworkers (USW). His Harvard University MBA and investment banker background made him a rare commodity for a labor negotiator, but has helped him drive a hard bargain at the table with business leaders.
As senior adviser to the Treasury and member of the Auto Task Force during the first half of 2009, Bloom helped Obama completely restructure the crippled U.S. auto industry during the nadir of the 2008-2009 economic crisis. On Labor Day 2009, Obama appointed Bloom as the adminstration's senior adviser for manufacturing policy, instructing him to create "good paying manufacturing jobs of the future." (1)
In July 2009, as Chrysler and GM restructuring efforts culminated and the two companies emerged from bankruptcy, Steven Rattner stepped down as head of the task force. Bloom replaced him as the "government transitions its role away from day-to-day restructuring to monitoring this vital industry and protecting the substantial investment the American taxpayers have made in GM, Chrysler, and GMAC," said Geithner. (2)
Joining Bloom on the Auto Task Force are ten members from across other departments in the administration, including Gene Sperling, a counselor to Geithner, Jared Bernstein, chief economist to Vice President Joseph R. Biden and Lisa Heinzerling, senior policy counsel at the Environmental Protection Agency.
At a Glance
Current Position: Chief Adviser to the Treasury Department on the Auto Industry (since July 2009); Senior adviser for the Manufacturing Industry (since September 2009)
Career History: Senior adviser for the Treasury Department on the auto industry (since Feb. 2009); United Steelworkers Union, special assistant to the president (1996 to 2009); Keilin & Bloom, founding member (1990 to 1996); Lazard Freres & Co. (1985 to 1990)
Hometown: New York, N.Y.
Alma Mater: Weslyan University, 1977; Harvard University, MBA, 1985
DC Office: N/A
State/District Office: N/A
Path to Power
Bloom was born in New York when it “was a strong union town,” according to the Pittsburgh Post-Gazette. "Growing up, the sort of issues of the day always included discussion of civil rights, social justice, the labor movement," said Bloom.(3)
Bloom’s father worked at a non-profit organization, while Bloom’s mother taught school. Bloom’s labor roots came from his aunt, who helped lead a teacher’s union. After he graduated from Wesleyan University in 1977, Bloom started working for the political organizing group the Jewish Labor Committee before joining the Service Employees International Union (SEIU).
While at SEIU, Bloom felt unions were pushed around by businesses because they didn’t have leaders that really understood how business works. “Unions were being backed into corners by companies and couldn't understand, on a sophisticated level, the company's arguments,” said Bloom. “Labor needed to be armed with the equivalent skills.” So he decided to attend Harvard Business School.(3)
Lazard Freres & Co
Bloom graduated from Harvard in 1985, and joined the New York investment bank Lazard Freres & Co., where he focused on union-related mergers and acquisitions.(4) While at Lazard, Bloom met Gene Keilin, and in 1990 the two men left the investment bank to start their own firm, Keilin & Bloom, which focused on union-related deals and corporate bankruptcies.
In 1996, Bloom left the firm he helped to build, to become the special assistant to the president George Becker at the USW. “I was very fortunate and privileged to be able to make a very nice living,” said Bloom. “But at the end of the day, people have to do different things: Your heart and soul will also have to be fed.”(3)
Bloom worked at the Pittsburgh-based headquarters of the USW, which has 1.2 million members, leading negotiations with corporate entities on restructuring labor benefits.(5)
Bloom's job is to help save the struggling U.S. auto industry, while also rethinking jobs across the entire U.S. manufacturing sector. He has the rare advantage of having been an investment banker who has worked for organized labor.
Auto Task Force
But prior to taking on the manufacturing role, Bloom was involved in a complete revamp of the U.S. auto industry that was controversial and politically-sensitive. In March 2009, the task force that Chrysler should receive 30 days to negotiate a merger with the Italian car company Fiat. For General Motors, it recommended allowing the Detroit icon to continue restructuring efforts for 60 more days. In April 2009, Chrysler filed for bankruptcy, and 31 days later a bankruptcy court judge approved the sale of the company to Fiat.(6) GM filed for bankruptcy on June 1, 2009. The Treasury Department will add an additional $30 billion in financing to GM and take a 60 percent stake in the car company.
A tricky part of the GM bankruptcy decision was how to negotiate with the United Auto Workers union (UAW), which represents GM workers. The UAW's retiree health fund was owed $20 billion from GM. With the help of Bloom, the UAW agreed to take a 17.5 percent stake in GM, plus it will receive $9 billion in notes and preferred stock.(7)
Wheeling-Pitt. Merger Discussions
In 2006, Brazil’s steel company Companhia Siderúrgica Nacional (CSN) was negotiating a merger with Wheeling-Pittsburgh Corp. The two companies had nearly finished the deal when the USW decided to block the merger and find a buyer more likely to adhere to union demands. Bloom and USW president Leo Gerard thought the bulk of the deal’s benefits would go to CSN instead of employees. With the help of Bloom, the USW found Esmark, a Chicago-based steel-distribution company that offered to layoff zero workers if the union agreed to allow Esmark to import steel from Ukraine.(8)
The USW supported Esmark as it led a proxy fight to gain control of the board at Wheeling-Pitt. Esmark succeeded in November 2006. “We turned the entire board over in one day -- little old Steelworkers and little old Esmark," said Bloom. Soon after, Esmark merged with Wheeling-Pitt.(8)
Goodyear Tire & Rubber Co.
In September 2003, Bloom led contract negotiations with Goodyear Tire. The company had faced a tough 2002, losing $1.1 billion to tire manufacturers selling cheap products with the help of labor in low-wage countries. Plus, Goodyear had dug itself a hole, creating $5 billion worth of debt due to unsuccessful acquisitions or new products. Bloom had to handle the negotiation, which would affect 19,000 jobs.(9)
As with many of Bloom’s negotiations, he had to cede some turf to the struggling company, but, by doing so, he saved a number of jobs. In the Goodyear example, the USW agreed to allow the tire manufacturer to cut labor costs $1.15 billion over three years, including letting go 3,000 employees. Goodyear promised to continue to invest in all but two of its U.S. factories.(9)
On the Auto Task Force, Bloom reports directly to Treasury Secretary Timothy Geithner and National Economic Council Director Lawrence Summers. Sperling, Bernstein, Heinzerling and Austan Goolsbee, staff director of the Economic Recovery Advisory Board, all help on the task force, as well. He is likely to work with the same players in overseeing the manufacturing sector.
Bloom worked for 12 years at the USW, including four under USW president Leo Gerard.
While Bloom worked for the USW, he has donated $6,350 since 2000. All of his donations went to Democratic campaigns, including $2,300 to President Barack Obama in 2008.(10)
Tapper, Jake, ABC's Political Punch Blog, Sept. 6, 2009
"Statement from Treasury Secretary Geithner on the Presidential Task Force on the Auto Industry," Department of the Treasury, July 13, 2009
Norton, Erle, "New blood for the USW," The Wall Street Journal via Pittsburgh Post-Gazette, Jan. 26, 1996
Greenhouse, Steven and Rosenbloom, Stephanie, "A Likely Auto Adviser Is Strong in Union Ways," The New York Times, Feb. 17, 2009
Pickert, Kate, "Ron Bloom, Obama's Car Non-Czar," Time, Feb. 18, 2009
Tse, Tomoeh Murakami, "Chrysler Gets Judge's Approval for Asset Sale," The Washington Post, June 1, 2009
Whoriskey, Peter and Marr, Kendra, "GM Files for Bankruptcy Protection," The Washington Post, June 1, 2009
Wysocki, Bernard Jr.; Maher, Kris and Glader, Paul, "New Clout -- A Labor Union's Power: Blocking Takeover Bids --- Steel-Company Buyers Learn They Must Get USW on Their Side," The Wall Street Journal, May 9, 2007
Welch, David, "What Goodyear Got From Its Union; The USW brought a plan to revitalize the ailing tire maker to the negotiating table," BusinessWeek, Oct. 20, 2003
Center for Responsive Politics