Private equity plans to run wild under Trump

In the longer term, the consequences of this will be among the worst aspects of Trumpism's effects on a lot of lives, including for many that voted for him or didn't vote.

Private equity has a well-deserved reputation as a ruthless industry that specializes in stripping and flipping companies to extract profits for wealthy investors and enrich its own billionaire CEOs. It’s an industry that increasingly dominates our lives. Private equity’s tentacles stretch across nearly every sector, including housing, hospitals, energy, prisons, retail and sports.

With a new corporate-friendly Trump administration, leaders of private equity firms are hoping for tax breaks, weakened regulation and access to trillions in 401(k) savings — all of which could broaden their sector’s reach over our society, increase financial risk for millions, and further supercharge billionaire wealth.

“It’s not only that private equity firms are exploiting the tax code to make themselves billionaires,” Eileen O’Grady, director of programs at Private Equity Stakeholder Project, told Truthout. “They’re also eroding health care, the climate and the quality of jobs across almost every industry.” - Truthout

Private equity is going after life insurance

I am so sick of seeing shit like this about private equity. But it is the inescapable present reality.

Private equity firms continue to stalk insurance company takeovers and critics say the potential for a financial disaster grows along with that trend.

Americans for Financial Reform, a Washington, D.C.-based nonprofit group that advocates for stronger regulation of Wall Street firms, is the latest group to raise alarm bells on what it deems to be risky private equity investment of policyholder funds.

AFR's new study grew out of its analysis of the relationship between private equity and public pension funds, said Andrew Park, senior policy analyst for the group. The PE impact on pensions is now understood, he explained.

"What has been less understood is how much of this new capital that private equity is getting is coming from the acquisition of insurance companies, and then in turn, insurance companies buying up a lot of the assets that private equity tends to originate," he added. "It's almost like you have this circular financing scheme that has been created now with private equity and insurance."

By the second half of 2023, private equity firms owned $774 billion in life insurance assets, or 9% percent of the life insurance industry, according to the AM Best insurance analyst. Likewise, PE firms are estimated to manage $5.7 trillion in global assets, giving these firms ample ability to buy up even more insurance companies, AFR noted.

The AFR report, Risky Business: Private Equity’s Life Insurance Gambit, comes amid growing pressure on private equity firms to submit to stronger oversight. Over the past month, the Financial Stability Oversight Council and the International Monetary Fund both released their own reports questioning private-equity control of insurers. - Insurance News Net

Labor organizing against private equity

It would help if government would pitch in a lot more on behalf of those who do the actual important, necessary work in this world.

The May Day action was the debut of an effort that organizers hope can provide a hub to better unite, educate and coordinate labor’s struggle against the growing power of private equity — in no small part by working with investors who manage workers’ retirement funds to demand that private equity firms abide by the platform’s planks.

Private equity firms invest billions in private companies, often purchasing controlling stakes in those companies, usually with the intention of restructuring and selling them off in several years. Private equity has a reputation for being perhaps the most ruthless arm of Wall Street, with a single-minded focus on stripping and flipping companies to make a profit. - Truthout

Private equity goons poised to strip-mine retirement funds

This is horrifying.

To the casual onlooker, the information letter from the Employee Benefits Security Administration reads like every other impenetrable passage of stereo instructions that fills the Federal Register -- but this was no routine piece of paperwork. The guidance to Switzerland-based investment firm Partners Group effectively changed the enforcement of federal law protecting workers’ retirement savings.

While longstanding worker-protection regulations have prevented 401k plans from investing in high-risk private equity firms, the letter now permits corporations to funnel that money to those firms, which charge notoriously giant fees. 

Trump’s administration argued that workers should feel fortunate and thankful that the administration will now let employers turn their savings over to private equity barons. - TMI 

The following is from a great overview article, about p. equity, that I read earlier this year. It’s aptly titled “Misery Makers.”

Many news outlets have published stories lately describing this destructive force, a force so powerful that it controls the livelihoods of 5.8 million employees. That’s how many people work in the thirty-five thousand companies private equity firms own in the United States. And some of those articles angrily mock what looks like the ineptness of executives, who buy a company, say they’re going to improve it, then ruin it instead. It seems like repetitious failure. But when private equity executives trot out the line that they are going to improve a company, understand that what they mean is: improve it for their own interests. And when ministrations result in the company’s collapse, understand that that’s private equity working as intended. - The Baffler

Private equity will never, ever stop screwing the rest of us

Not until it’s crushed. Obliterated. Annihilated. So that’s what needs to happen.

It’s tough to pull a really representative blockquote from this one. I can only respectfully ask that you take my sincere word that you should click and read it all.

It is part of a growing trend of private equity investment in health care in the United States. 

The pandemic has put into stark relief how these billionaire investors have fundamentally weakened the health care system...

Hospital acquisitions were popular among private equity firms from 2000 to 2012. But many firms struggled to make money from those acquisitions and have turned their attention to more profitable slices of the health care economy. 

In particular, private equity has been gobbling up staffing service for emergency rooms and then taking the doctors out of the hospital’s insurance network. As a result, many people return home from the emergency room with massive bills they thought would be covered by their insurance company. This phenomenon is known as “surprise billing.” - Popular Information