Private Equity under a Political Lens
The ascension and resistance to the presidential aspirations of former Bain Capital head Mitt Romney has lead to a sudden mainstream focus on private equity – even when Romney is mistakenly identified as a venture capitalist. Fortune Magazine’s Dan Primack sees plenty of faults on both sides, and offers his hopes for an honest debate.
Primack fact checks the video about Romney’s firm by a GOP rival, finding it staggeringly error prone. But he also finds some selective engagement in the opinion pages of the Wall Street Journal, which defend the benefits of private equity while largely skipping over the roles and riches of financial engineering and dividend recaps.
Soon enough, more mainstream sources like The New Republic followed suit, which may not have raised the level of discourse, but at least gave it some focus. At some point, the blatantly obvious – that as in all industries, there are some PE practices (and firms) more honorable than others – may surface. Politics tends to distort both facts and reputations, and as we enter the political season, the smart long position is to expect more of the same.