There are a number of new developments in the case of John Q Public vs. Private Equity.
First up, SEIU president Andy Stern testifying in front of Congress today. You can download his prepared statement here: Stern.Testimony.pdf
Of greater interest, the AFL-CIO reportedly sent the SEC a letter asking that it investigate The Blackstone Group’s planned IPO. Why? Because AFL-CIO believes that Blackstone may be sidestepping securities laws via its structure as a “partnership” rather than as an “investment company.” It’s unlikely to have any direct impact on Blackstone, but is another log added to the larger fire.
In related – albeit far less important – news, I spent an hour on NPR last night, discussing Chrysler and private equity with HBS professor Josh Lerner and former U.S. Labor Secretary Robert Reich. You can listen to the podcast and submit comments here, and should pay particular attention when Reich comes on at around the 30 minute mark. He is the latest pol to speak out on the tax treatment issue, which he calls a “tax dodge” by private equity investors.
Reich also wrote a blog post about it. If you got rankled by what I’ve written on the subject, you should perhaps take a Tums before reading Reich.