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Former ODU President Co-Authors 'America for Sale,' a Look at Mergers and Acquisitions in U.S. Steel Industry

In "America for Sale: How the Foreign Pack Circled and Devoured Esmark," co-authors James V. Koch, Board of Visitors Professor of Economics and President Emeritus at Old Dominion University, and Craig T. Bouchard offer an inside look at a unique hostile takeover on Wall Street and thoughts about the larger evolving saga of the U.S. steel industry.

Bouchard, lead author, was the co-founder in 2003 of Esmark Inc., one of the half dozen largest steel companies in the country, which was sold to a Russian firm in August 2008. At the time of the sale, he was the president of Esmark and Koch a member of its board of directors.

In the book's preface, the authors maintain that they are "free traders and free marketers, who believe that 95 percent of all foreign acquisitions of U.S. firms and assets are no problem." But they go on to say: "We draw the line, however, when more than half of a core industry that is vital to national defense - steel - has fallen into the ownership of foreigners."

They argue, "The Committee on Foreign Investment in the United States (CFIUS) must become more active, extend its reach, and challenge more acquisitions than it has in the past," and make the following prediction: that "'America for Sale' conditions will reoccur in 2010, after economic recovery has begun worldwide. Key to this reappearance will be a dramatic fall in the value of the U.S. dollar. A fire-sale atmosphere will reign once again, and more industries will go the way of the U.S. steel industry."

Koch and Bouchard offer the following major predictions in the book:

• significant price inflation in the second half of 2010 and after;

• the value of the U.S. dollar continues to fall relative to major currencies; and

• the "America for Sale" phenomenon will come back, as it will appear to foreigners that our assets can be purchased for very low prices, expressed in their currencies.

Bouchard credits Koch with coming up with the idea for the book, which Koch describes as a study of the purchase of U.S. assets by foreigners. On the book's back cover, Bouchard notes: "Our story provides an insider's glimpse at the fireworks surrounding a unique hostile takeover on Wall Street and the quiet ascent of a labor union to a renewed position of power in corporate America and in Washington, D.C.

"In the process, we have attempted to create an economics road map of use to any hardworking American attempting to understand the astounding politics of the Obama administration and the implications for our economy in 2010 and beyond."

"America for Sale" was published in 2009 by Praeger.

In a book review published in the Nov. 1, 2009, issue of American Metals Market (amm.com), Scott Robertson writes: "'America for Sale: How the Foreign Pack Circled and Devoured Esmark' answers many questions and poses more. Those who read it likely will come away with a better understanding of the moods and motivations of major business leaders as they construct merger deals."

He also notes in the review: "There is something in the book for students interested in economic lessons and for steel veterans wanting the inside story to sports fans wondering how Stanley Cup playoff hero Evgeni Malkin ended up playing with the Pittsburgh Penguins."

Koch has published 10 books and 100 articles in refereed journals. His research has focused primarily upon applied microeconomics topics. His journal articles on the economics of intercollegiate athletics, the economics of discrimination and affirmative action, TQM and the economics of education have been reprinted and cited frequently.

His recent research examined the risk-taking behavior of corporate CEOs and was funded by the Kauffman Foundation. The results of the research were published as "Born, Not Made" (Praeger, 2008). He has a contract to write "Creative Destruction," an examination of the economics of e-commerce and the Internet.

This article was posted on: November 2, 2009

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