www.ralphnaderradiohour.com/p/bad-company
Ralph Nader Radio Hour welcomes journalist and author Megan Greenwell to discuss her book “Bad Company: Private Equity and the Death of the American Dream.” Then, Ralph speaks to James Zogby (co-founder and president of the Arab American Institute) about the recent Israeli attacks on Lebanon.
Megan Greenwell is a journalist who has written or edited for publications including theNew York Times, the Washington Post, New York Magazine, WIRED, and ESPN. She is also the deputy director of the Princeton Summer Journalism Program, a workshop and college-access initiative for students from low-income backgrounds. She is the author of Bad Company: Private Equity and the Death of the American Dream.
The real trick with private equity (and this was the thing that made me want to write a book on it) is that when they take out those billions of dollars worth of loans (if you’re buying a bigger company), the private equity firm is not responsible for paying those loans back. Only the portfolio company in whose name the private equity firm has taken the money out is on the hook for that money. And so what you end up with is this split in incentive where what’s good for the private equity firm is not necessarily what’s good for its own portfolio company.
Megan Greenwell
[Congress hasn’t repealed the carried interest loophole] because Congress is in the pocket of the private equity industry. 88% of members of the House and Senate take donations from private equity. Interestingly, Donald Trump has called twice for the carried interest loophole to be closed. And still, even he, as much of a stranglehold as he has on the Republican Party, he can’t build support for it among Republicans. Because they’re all taking private equity money, as are the vast majority of the Democrats. So this is not a partisan issue.
Megan Greenwell
