America's Central Planners, Part One: The New Crop of Dollar-A-Year Men
Legalizing and enabling PE ownership of physician staffing services, hospitals, and other medical assets is troubling. My dad and sister are both surgeons and their salaries have already been cut in half - don't know if its related to PE. The details of these financial activities at the top end of Wall Street always just sounds like crime. I'm not sure how we got to a place where we basically just let these firms do whatever they want (I just started Goliath though so I will soon), but clearly heavy regulation of PE is at the top of the reform list. What other areas of the economy are vulnerable to PE restructuring right now? Other than PE, are there any other sectors of the financial industry to watch that are more likely to accelerate concentration of financial power?
Can’t wait for your next, hopeful one on PE! Thank you!
This is possibly the best, and scariest, column I've received from BIG. As someone well-read in US economic history from the end of the Civil War on, and who worked briefly on Wall St during the "modest" (I assume this is ironic) conglomerate craze of the '60's, I've long thought the very institution of Private Equity is a dangerous tool of unregulated private power. And this better description than I've ever read of how it works confirms that opinion.
The scariest thing is that I don't believe the Public is up to the challenge of even understanding how this tool of control works, much worse and more deeply rooted than the "interlocking directorates" exposed during the muckraking era of Teddy Roosevelt's time.
It's very odd to consider that the General Public is probably more obtuse and more successfully propagandized now than in the first decade of the 20th century. So much for a century of ever larger college "educated" generations (It's a chicken and egg question of whether politicians, especially Democrats, have failed to educate them, or whether too many of the Public simply didn't want to be educated on this issue for fear of upsetting a status quo beneficial to them).
Here's one suggestion for change. Having read and seen the strongest indictments yet of Trump's colossal and wrong-heraded incompetent response to covid-19 in the Wash Post
and on 3 tv news shows this morning, who will start calling for his resignation?? What hasn't that happened already?
Is it possible that he has so intimidated critics, and so successfully branded the non-Fox
Media as "fake news" that no on dares to do what many must be thinking? Who will break the silence on this?
If his deadly incompetence is ended, which he is even today doubling down on, his departure would be an indirect way of POTENTIALLY opening a path to do something New Deal-like to deal with this hidden power of Central Planners-for-their-own benefit so well described in this piece.
Interesting take on the private equity industry. I do believe you lean heavily in one direction by magnifying events and omitting the merits of private equity in small businesses. I did some more research and found that these finance professionals offer financing where others won’t allowing for growth in the economy. What are your thoughts on the pros vs. the cons?
This is how some folks in Philly feel about Joel Freedman: https://philadelphia.cbslocal.com/wp-content/uploads/sites/15116066/2020/03/hahnemann-joel-freedman-vandalism-1.png
Love your writing but small grammar tweak: it's "try to" not "try and". "Try and" will occur only in some form like "he tried and succeeded," but for a verb "try to succeed," "try to <verb>"
Thanks for wrtiting this article. Despite your subtly apparent political leanings, you make some excellent points, great sense and conclude with a very valid assessment of what motivates/motivated the important actors. (Economics is the study of human behavior.) Even those who firmly believe in capitalism, as I do, must find the activity of these P.E. conglomerates deeply troubling. Bless you for bringing light to such an important topic. Please keep up the terrific work!
I am trying hard to spread the word about this blog! Keep it up!
Thanks for the article. Is the target company of these plays usually playing along -- that is, is the management taking on the debt since they see a short term fix, collect a bonus and then bow out before it blows up? Having employees on the board might put a quick stop to this behavior.
Can I have your permission to try and do a video summary of this video? I am a bike seat journalist in the making: https://www.youtube.com/channel/UCDpBAZeCMD3UQp8PuQIxsEw?view_as=subscriber
Damn, that’s some excellent writing... thank you.
This article paints the structure of the current bailout in a way I can begin to compare it to the TARP. With trillions at stake here, the risk appears huge for PE debt write offs against the American taxpayer. Can the accumulation of past poor performing Health care or real estate portfolios be jammed in as “coronavirus impacted losses?
Please mandate Essential retailers To take responsibility to help stop the spread. Help our Doctors and Nurses have a fighting chance. Do not allow shoppers in store force a Change all retail to call ahead orders and pick up or delivery service.