Private Equity Takes Steps to Fight Bad Rep–UPDATED

The private equity industry is fighting back against the deluge of bad press caused by Mitt Romney’s presidential campaign.

First up is the Private Equity Growth Capital Council, the advocacy organization that represents the industry. Are PE firms merely corporate raiders whose only intent is to destroy jobs and reap huge profits? Of course not, the PEGCC says.

The group maintains that the PE industry is “simply misunderstood, and actually helps boost the economy by strengthening companies and creating jobs,” according to The Hill.

The PEGCC today unveiled a new campaign, “Private Equity at Work,” that aims to fight those baseless attacks. The effort comes with a new website, www.PrivateEquityAtWork.com, and a resource center that provides educational content, industry data and an “in-depth look at specific PE investments that are driving growth and creating jobs,” PEGCC says in a statement.

UPDATE: Tony James, Blackstone’s heir apparent, also fought back today during the buyout shops Q4 earnings call. James said it was distressing to see “vicious, politically motivated attacks on the private equity business that are both inaccurate and unfair,” the Financial Times reports. While a few deals don’t work out, James says that “these exceptions provide anecdotal fodder for political attack ads.”

“Private equity helps preserve and restore America’s aging industries and moribund assets,” he says in the story. “This takes both large amounts of capital and true operating expertise.” The Blackstone president then cited a $670 million modernization program the buyout shop has undertaken at a U.S. oil refinery, the FT says.

In the Wall Street Journal, Armand Lauzon writes about his experience as CEO of three companies owned by the Carlyle Group. Lauzon was required to put his own capital into the companies, he says. “My clear mandate at every company has been to increase revenues, develop new products and markets, drive profitability, and create a sustainable business for the benefit of shareholders, management and employees. Our view has been distinctly long-term,” says Lauzon, in the story. Lauzon is currently the CEO of Sequa Corp., which Carlyle bought in 2007.

My favorite today? David Rubenstein’s comments about the upcoming Carlyle IPO. Rubenstein, a Carlyle Group co-founder, says he’s taking the firm public to “liquefy” his stake and doesn’t plan to keep all of his riches. “I’m committed to giving away the bulk of my money. If I have money that is available to me as a result of some factors, that’s what I’m going to do with it,” Rubenstein says in the story.

Rubenstein also goes on to defend Romney and his low tax rate. Earlier this month, Romney revealed that he and his wife paid an effective tax rate of 13.9% in 2010. They expect to pay 15.4% when they file in 2011. Yowza. (Yours truly pays around 28%.) Romney’s tax rate is low because most of his income flows from capital gains on investments, according to Reuters.

“When people comply with the law, they shouldn’t be criticized by people who say, ‘The law says you’re supposed to pay X, you should have paid 2X,'” Rubenstein says in the Bloomberg story. “Change the law if you don’t think the law is appropriate.”