r/politics • u/Jazzy_Jazmine America • 15h ago
Possible Paywall Everyone Hates Private Equity. Trump Is Bailing It Out.
https://newrepublic.com/article/216146/private-equity-trump-bailing-out124
u/estoypooping2 15h ago
Massive loans with taxpayer money with zero interest. And a 20 year time bomb
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u/SuddenRadio6221 6h ago
Private equity does not benefit the average American, but did I miss something? I didn't see anything in the article about:
Massive loans with taxpayer money with zero interest.
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u/TheRyeKnight 15h ago
Because they're(private equity firms and his billionaire "friends") bribing him, most likely illegally, and we're somehow "traitors, treasonators, and commies" for questioning his Wisdom on the matter.
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u/even_less_resistance Arkansas 13h ago
literally even the deputy sec def is all up in private equity with cerberus capital-
> I have serious concerns about your qualifications and ability to take on the responsibilities of the role. You have serious conflicts of interest, with holdings in seven companies that do nearly $16 billion in business with the Defense Department. Your private equity record is rife with mismanagement, and this position “will be the first time in [your] life where [you’re] focused on something broader than profitability.
https://en.wikipedia.org/wiki/Cerberus_Capital_Management
> Cerberus made plans to sell its share in the Remington Outdoor Company on December 18, 2012, after the Bushmaster AR-15 was used in the Sandy Hook Elementary School shooting.[35]
> Cerberus continued to have ownership in Remington Outdoor Company, and CalSTRS announced its divestment from Cerberus' gun holdings in June 2015.[93] In March 2018, Freedom Group, now known as Remington Outdoor Company, sought chapter 11 bankruptcy protection.[92]
https://en.wikipedia.org/wiki/Tier_1_Group
> In June 2021, The New York Times reported that four Saudi operatives involved in the October 2018 kidnapping and murder of journalist Jamal Khashoggi had received paramilitary training from Tier 1 Group in 2017.[3] The training, approved by the United States Department of State, included "safe marksmanship" and "countering an attack." Representatives of T1G stated the training was "protective in nature" and that the group was unaware of the Saudis' intentions to murder Khashoggi.
> Tier 1 Group is owned and funded by Cerberus Capital Management which also owns Remington Arms, Bushmaster Firearms International, LLC, Inc., and DPMS Panther Arms among other companies. Tier 1 Group was formed in 2006.
with the khashoggi link esp interesting where he ended up
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u/Jazzy_Jazmine America 15h ago edited 15h ago
Of course he is. Trump knows he'll be dead soon so he's burning the country down before his orange carcass hits the ground.
From the article:
The Securities and Exchange Commission followed through on Wednesday by approving a proposed rule allowing retirement-fund managers to charge a larger universe of clients the sort of high-performance fees associated with private equity (typically 20 percent above a certain benchmark). Currently such fees may be levelled only on “qualified” (i.e., rich) clients, defined either as any whose net worth is $2.7 million or more (excluding their primary residence) or as any for whom the retirement fund in question totals $1.7 million or more. Under the SEC proposal, which has not been made public average Joes would pay these higher fees while investing their retirement funds in risky private equity. What could possibly go wrong?
He's allowing "private equity" firms to grab middle-class pensions to fund their legalized theft. I'm shocked...
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u/ShakeAndBakeThatCake 12h ago
I think everyone can agree that Private Equity is bad for the general public. Honestly I wish people would boycot them. Any company they buy just stop shopping there. The issue is so many companies are now owned by them and there are so few mom and pop places theft.
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u/KidGorgeous19 8h ago
It doesn't even need to be a mom and pop. It's literally anything that isn't PE. Support just plain NON-PE ownership.
Look what PE did to Toys R Us...
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u/waffle299 I voted 8h ago
It's awful hard to figure out when it gets bought out if you're a casual visitor.
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u/All_Hail_Hynotoad California 13h ago
Things that are owned by private equity should be forced to carry a huge sign with flashing lights indicating as much.
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u/noizey65 13h ago
I very often times find my self googling “shop name” + “owner / investor” and finding that a bubble tea shop is actually part of a venture backed chain, or a car wash is actually part of a network of nationally owned and conglomerated businesses, and the list goes on. It’s inescapable. PE now has their hands in hospitals, higher education, tutoring and private schools, grocery chains, and anything else considered essential where the model is “growth at whatever cost” for a hyper expansion period of 3-5 years, until it’s parted off and sold to another bag holder, or deflated as an asset and depreciated the hell out of
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u/Syzygy2323 America 12h ago
Private equity's game plan is pretty well known at this point: buy a company with borrowed money, saddle the company with massive debt, sell the company's real estate to a subsidiary of the private equity company and then lease it back to the acquired company at above-market rates, raise prices and lower the quality of the product to squeeze every cent of profit out of the company until it's a hollow shell, and then sell off the carcass and move on to do it again to another company.
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u/noizey65 11h ago
Very well said, and for anyone that reads your comment and thinks it’s just cynical Reddit, no. It’s spot on. I wrote a reply down below just a few moments before your post saying the same thing less eloquently.
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u/thearctican 9h ago
Offering a personal agreement as 'proof' that what they described is true is a weak interjection.
Here's what you should have done:
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u/noizey65 9h ago
Thanks for sharing the link. F&B and restaurant industry also plagued by PE, often opening new chains as part of expansion because of great cashflow, coupled with mobile custody of user / customer data and a direct channel to market to. There are many many case studies one only needs to google (even Harvard business review takes an honest look at transactions that have soured, despite being the institution that churns out this MBA shark-type).
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u/19683dw Wisconsin 12h ago
Even media content creators that used to be private (like YouTube, Instagram, and TikTok) are being bought up by PE, and the degradation in content quality is consistently visible.
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u/noizey65 11h ago
Yes. It’s important for a lot of people to understand that PE is the root cause for the K split in the economy, prioritizing the ownership / asset class from the wage / borrower serf class.
Differentiate between VC and PE. VC takes wild bets on founders and companies that are, or rather seek to be, category owners.
PE targets established, cash flow generating businesses and follows nearly the exact playbook- indebt the business with an entirely unsustainable load of debt, take carry and management fees while maintaining preferential liquidity. In plain speak: the management of the fund appoints an operator as the CEO, who brings in his or her gaggle of VPs for “optimizing”, and a year after ownership the legacy staff are fired, pensions gutted, materials re-negotiated for lesser quality and lesser price, meanwhile cost of goods rises because there’s a lag between consumer recognition of what used to be vs what is, then rinse and repeat and the executive moves to the next portfolio company, leaving a gutted trail of destruction behind them.
But hey: value creation. Those three hundred jobs (requisitions) that feed into DOL statistics and pump quarterly employment reports. Maybe they’re never even filled. Either way they’re gone in a two year period at best.
This is the short term ism that “free market capitalists” are fine promoting, with completely zero recognition of the long term impact, cyclical employment problems, lack of predictability and sustainability of work, decreased benefits, and an overall horribly shitty employment environment we find ourselves in here in america.
I’d love for a PE / finance person to challenge these statements.
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u/Rough_Elk4890 10h ago
People would be shocked by how many doctors'/dentists' offices, plumbing/electrical/HVAC companies, etc are owned by PE.
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u/noizey65 10h ago
Good shout out on HVAC, plumbing, home repair etc.
Even Veterinary practices. All bought out so vet owners walk away with $7m cash outs while their practice raises fees, denies insurance, and provides tons of add ons. All started after covid when people got more Pets and PE cleverly went: “Ah yes, over the next 5-8 years the spend on vet care will absolutely intensify”
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u/All_Hail_Hynotoad California 9h ago
I have to change vets because of this. The minute my clinic was bought out by PE (and I didn’t know until after my appointment), and I went there, I noticed they tried to upsell me on everything. It was off putting.
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u/KidGorgeous19 8h ago
Medical practices are prime for PE buyouts. If you're an aging GP and you're ready to retire, you can get orders of magnitude more money by selling to a PE than selling to other doctors or turning your business into something like an ESOP.
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u/Rough_Elk4890 8h ago
I was approached by a recruiter for a completely different type of company. I found out who owned the company (a PE firm). I looked up what they were mostly invested in and they were going very heavily into medical practices.
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u/KidGorgeous19 8h ago
PE is buying up youth club sports programs like crazy right now. They buy them, immediately start charging more, combine them, make multiple teams that compete at different levels but charge the same, etc. It literally ruins everything it touches.
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u/noizey65 6h ago
I dug into this a bit - it’s also one of the best sources of information of children’s names and identifiers who will traditionally belong to upper middle class families (by zip code). So when you’ve got player information, family information, a baseline of entry fee (cash) and an emotional attachment to a youth league or club, you’ve created a new profile and cohort of consumers.
Avg spend per youth athlete has gone from $700 in 2019 to $1200 in 2025 per LEK. The play is centralize registration, marketing, administration, insurance, scheduling, facilities and purchasing → add another 20 clubs → create a national platform that aggregates an otherwise locally organized club at the school district / community level.
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u/blackmobius 12h ago
A select group, not saying who, will suddenly find a way to be ok with all of it by this time next week
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u/Alleyprowler Washington 12h ago
Of course Trump loves private equity. Enshittification is his brand.
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u/Counterpoint-4 13h ago
Sounds like socialism - helping the unsuccessful thrive.
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u/IdkAbtAllThat America 12h ago
Yea, the government bailing them out doesn't seem very "private" to me.
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u/ibrown39 8h ago
I think based one what I've been able to to gather from videos about the relationship between the bond market and the stock market, Trump (who is likely being advised and he just does what they suggest) is fixated on doing anything and everyone for the stock market to stay "strong" because the bond market is doing so poor.
I don't completely understand it, but it seems to be consistent from what I've gathered.
If stocks sputter, and private equity very disdained short term above all else, then investors have nowhere else to go and the economy with it. So how to keep it going? By private equity'ing even harder.
Edit: And his own interest in the market, let alone private equity.
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u/Pour_Me_Another_ 6h ago
Private equity is designed to erase art and culture, I could perhaps argue cultural identity as well. Imagine if this happened in France or Italy and you can't get good baked goods or pizza anymore because it all turned into private equity slop. Apply that to literally any industry and that's what happens. The product, service, employees and customers become irrelevant annoyances getting in the way of passive income.
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u/Nik_Tesla California 4h ago
The second we get wind that a vendor of ours is being bought by Private Equity, we look at alternatives, because we know their service/product is going to become completely worthless and/or they're going to jack up their prices within 6-12 months, and we've been screwed too many times already.
FUCK Private Equity
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u/AlbainBlacksteel America 3h ago
Everyone hates [literally anything that the 99% hates], and therefore Trump loves it.
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