Cream butter in a large bowl. Add sugar and molasses; beat well. Add egg; beat well. Dissolve soda in water; add to creamed mixture, beating well.
Combine 1 cup flour and baking powder; stir into pudding mixture. Combine cranberries and remaining flour; toss lightly. Stir into batter. Pour batter into a well-greased 1 1/2- quart steam pudding mold, and cover tightly with lid.
Place mold on a rack in a large stockpot with enough boiling water to come halfway up sides of mold. Cover stockpot. Place on bottom oven rack. Steam in oven at 350° for 3 hours. Remove mold from water; cool slightly. Remove lid from mold to allow steam to escape. Loosen pudding from sides of mold. Unmold onto a serving dish. Serve warm with Rum Sauce.