I cannot contain my disgust with the mainstream media as I am writing this post. I am watching David Gregory on “Meet The Press” interview Republican Governor Kasich of Ohio and Democratic Governor Deval Patrick of Massachusetts. David Gregory allowed Governor Kasich to spew complete inaccuracies unchallenged and was very effective in preventing Governor Patrick ample time or options to respond. That said, Governor Patrick was rather inept at expressing the administration’s positions that every middle class American need to digest. Specifically that while the job private equity firms perform is legal in our current brand of capitalism, job creation is neither necessarily a result of its functions or its goals. Its goals are to make profits at whatever cost for its shareholders. The job of an executive of a very successful private equity firm is diametrically opposed to the job of the president of the United States.
Private equity firms go into weak companies, streamline them by increasing efficiency and productivity (firing workers to get more output per worker thus increasing individual work load). The majority of that efficiency gain goes into the pockets of the shareholders, not the creators, manufacturers, and producers of the product and services. Private equity firms go into weak and strong companies, leverage them (take out loans on their assets), piling on debt which reduces taxable income of said corporation. The private equity firms then walk out with faux profits that again benefits the small quantity of wealthy shareholders. In so doing the US Treasury is deprived of tax revenues from the company, from the fired workers, from the lower wages even as the government then must provide a safety net to the displaced workers. If this is not class warfare, a legal systematic transfer of wealth from the working middle class to a select few, I do not know what is.
Many of us have failed to put into the appropriate context that this sector and other financial sectors are a detriment to our society. I made an attempt in my book “As I See It: Class Warfare The Only Resort To Right Wing Doom” to articulate this. Professor Robert Reich in Beyond Outrage does an excellent job in describing what the wealth disparity and income disparity has done because of a financial sector rigged against the middle class. Only a learned middle class can do something about this.
This is not a partisan issue. After all Democrat Mayor Corey Booker, Democrat Governor Rendell, Democrat Former President Clinton, and Democrat Governor Deval Patrick have all defended these companies. We have a political class that is owned by the financial class. This will always put the middle class at a disadvantage and we are living through this now.
