A few weeks after the 2008 presidential election, United Steelworkers President Leo Gerard got a call from an Obama transition aide frantic for advice on the collapsing auto industry. Gerard put his numbers guy on the call, a former investment banker named Ron Bloom, who proceeded to offer a detailed disquisition on the financial situations of GM and Chrysler. Unlike other experts the transition team had consulted, Bloom was refreshingly blunt about the companies’ prospects, which he deemed grim. “We were like, ‘Wow, who is this guy?’” recalls the aide.

I just wanted to highlight my latest print piece for readers who come straight to this blog rather than clicking through from the homepage. It's about White House manufacturing czar Ron Bloom, a longtime steelworkers union official and an investment banker before that. Just prior to his current gig, Bloom led the administration's restructuring of Chrysler as a deputy to Steve Rattner, then head of the auto task force.

There are details in the piece more relevant to Bloom's current job and the future of U.S. manufacturing, but I just wanted to highlight two nuggets that stuck with me from the Chrysler episode. First this:

It fell to Rattner and Bloom to broker the deal. Culturally, the two men were near opposites. Rattner had been a trustee of the Metropolitan Museum of Art; Bloom brought his cherished Mr. Potato Head collection to decorate his Treasury office. Bloom also had a reputation in management circles as a gadfly. “There have been a number of cases where company representatives simply refuse to engage him in debate,” says Jim Robinson, a former colleague at the United Steelworkers. During one negotiation early this decade, management kept insisting that its accountants wouldn’t sign off on a proposal to fund retiree health care. As it happened, the company’s accountant-a partner at a major firm--was on-site but not in the room. “Ron kept telling them to bring the partner in so they could debate the issue,” recalls Robinson. “But he wouldn’t come.”

And then:

[Bloom's] particular genius is to let an adversary win on an issue, then gradually, subtly reclaim it for his side. So, for example, Fiat might insist that a government loan be forgiven. Bloom would concede it, then offset the loss using the terms of a second loan later on. “Ron has what I refer to as ass power,” says Feldman. “He’ll continue to talk about things, explore them, work on them, not letting the other side see what’s really important to him. Even if it’s important, he’ll bargain it away early and work on getting it back.”

Also, there are two other things I need to mention here. First, toward the end of a piece I include an anecdote about a U.S. company called FormFactor that's been having trouble in Korea of late. The anecdote ends with the following paragraph:

It looks like Fritz Henderson, who only took over as GM's CEO back in March, has been forced out by the company's board. From the Times:

General Motors said Tuesday that its chief executive, Fritz Henderson, was resigning and would be succeeded on an interim basis by the automaker’s new chairman, Edward E. Whitacre Jr. ...

Mr. Henderson became chief of G.M. after the previous chief executive, Rick Wagoner, was asked to resign in March by President Obama’s auto task force. But in a sign that the company’s board is dissatisfied with G.M.’s progress, Mr. Whitacre, the retired head of AT&T, will assume the top job on a temporary basis.

“We all agreed that some changes needed to be made going forward,” Mr. Whitacre said.

It's obviously a little early to draw conclusions about what happened. But my first impression is that this could be a signal of relative strength. When the Obama auto task force fired Wagoner, it seemed to want to replace him with an outsider capable of shaking up the company's staid culture. But the task force worried about putting the company through such a radical change during a period that was already so wrenching, and so it settled for Henderson. At least that's the impression you get from former auto czar Steve Rattner's account in Fortune last month. And from this excellent narrative of the GM bailout in the Times back in July. The Times piece actually had a great nugget highlighting the cultural problem Henderson posed:

If you've been following the trials of the auto industry this last year, then you already know GM's management team, led by former CEO Rick Wagoner, left a lot to be desired. But, even so, Wagoner comes off as unbelievably lame in Steve Rattner's account of his time as Obama's auto guru. To wit:

At GM's Renaissance Center headquarters, the top brass were sequestered on the uppermost floor, behind locked and guarded glass doors. Executives housed on that floor had elevator cards that allowed them to descend to their private garage without stopping at any of the intervening floors (no mixing with the drones).

In my relatively few interactions with chairman and CEO Rick Wagoner, I found him to be likable, dedicated, and generally knowledgeable. But Rick set a tone of "friendly arrogance" that seemed to permeate the organization.

Certainly Rick and his team seemed to believe that virtually all of their problems could be laid at the feet of some combination of the financial crisis, oil prices, the yen-dollar exchange rate, and the UAW. ...

As we continued our rather awkward conversation [about his ouster], Rick suddenly asked, "Are you going to fire Ron Gettelfinger too?" Startled by the reference to the UAW head, I replied, "I'm not in charge of firing Ron Gettelfinger," and Rick soon left to brief his board on our decision.

How bout a little personal responsibility? After all, as Rattner notes, "any management team that had burned through $21 billion of cash in a year and another $13 billion in the first quarter of 2009 could not be allowed to continue." 

The question is whether Wagoner's successor, Fritz Henderson, is really up to the job of changing GM's culture. He was, of course, part of the same management team that made a habit of shuttling directly from the executive suite to the garage and back. (No word on whether or not that's changed.) Also, you get the impression from Rattner's account and others that the auto task force would have liked to hire an outsider, but thought there was a limit to the amount of change the company could withstand. My favorite indicator that Henderson was far from the ideal choice comes from this Times piece: