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More Bloomin’ Czars

August 24, 2009

More Bloomin’ Czars

By INVESTOR’S BUSINESS DAILY | 21 Aug. 09

Big Government: Ron Bloom, who heads the government’s auto task force, may soon have a new job. As Bloomberg reports, the White House wants him to become a new de facto manufacturing czar. What next?


Read More: Business & Regulation


Once in power, Democrats love nothing more than finding a problem so they can create a new level of government to deal with it. Even if there’s no problem, they will — pardon the phrase — manufacture one.

So it is with the possible appointment of Bloom, a former United Steelworkers union adviser who now heads the U.S. auto task force, to be a kind of national industrial policy czar.

The manufacturing sector has indeed been hit hard by the downturn. But so has the rest of U.S. industry. The only real growth sector, as the Rockefeller Institute reported Thursday, is government. While private jobs have shrunk 6.9 million since the start of the recession, state and local governments have added 110,000 positions.

Problem is, President Obama signed a $787 billion stimulus bill in February and vowed to create 3.5 million jobs over the next two years. And a major part of his support comes from unions.

His “stimulus” isn’t working, and he must be seen as “doing something.” Thus, Bloom gets named factory czar.

The question naturally arises: Do we really need a factory guru, especially one whose expertise is in advising labor unions — the cause of much of the U.S. steel and car industries’ woes?

The obvious answer is no. This is just another attempt to revive the long-discredited idea of industrial policy — the notion that markets are inefficient and unfair, and the economy can best be managed by government “experts.”

In the case of manufacturing, it isn’t as sick as we’ve been led to believe. In fact, total value added by the nation’s factories in 2008 hit a record $1.64 trillion for a gain of 21% since 2003.

And despite talk of the U.S. losing its industrial might, we still make up 25% of the world’s manufacturing value added — nearly 2 1/2 times China’s output, U.N. data show.

True enough, manufacturing has lost jobs in recent years. But most of the decline is due to rising productivity. Since 1990, factory output has soared 44%, while the number of factory jobs has fallen 32%. This may be the greatest productivity boom since the Industrial Revolution — an economic triumph rather than a tragedy.

Do manufacturers need a bureaucrat as boss? Or even as their advocate? Of course not. They need what the rest of us need — a healthy private economy. Create conditions for that — with lower taxes, fewer regulations and freer trade — and factories will flourish. And Obama’s 3.5 million jobs might not be such a pipe dream.

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