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Bob McDonald To Head Dept. of Veterans Affairs

July 1, 2014

Former P&G CEO takes over scandal-riddled bureaucracy.

Some jobs are even bigger than leading the biggest consumer products company on the planet. President Barack Obama will nominate Bob McDonald, former CEO of Procter & Gamble, to head the Department of Veterans Affairs. The VA, a massive bureaucracy with more than 300,000 full-time employees, is under fire over allegations of alarming shortcomings at its medical facilities.

President Obama's choice still must be approved by Congress, but McDonald has plenty of supporters. House Speaker John Boehner, an Ohio Republican, said in a statement that McDonald is “the kind of person who is capable of implementing the kind of dramatic systemic change that is badly needed and long overdue at the VA.”

If confirmed, McDonald, a West Point graduate and U.S. Army veteran who oversaw more than 120,000 employees as P&G’s CEO, will lead a department that serves more than 8 million veterans annually. He would succeed Eric Shinseki, who resigned last month amid a scandal over failures of the agency’s medical system. Sloan Gibson has served as acting VA secretary since May 30.

“You put a manager in to fix what clearly is a managerial problem,” said Matt McCormick, vice president and portfolio manager at Cincinnati-based Bahl & Gaynor Inc., which holds about 4.2 million P&G shares. “He’s far superior to who we had doing this before.”

In a report issued by the White House on June 27, the department was portrayed as hobbled by a “corrosive culture” and lack of accountability. Its medical system has been beset by extended waits for appointments and allegations of falsified records to cover up those delays. VA officials often ignore orders from its central office, according to a summary of the report by White House Deputy Chief of Staff Rob Nabors.

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