Too funny...
Money Talks
HE WHO PAYS THE PIPER CALLS THE TUNE.
How's that for original phrasing? But for all it may be a bit shopworn, that familiar old saw depicts with remarkable precision how politics works.
Take the idea of making private equity and hedge funds subject to a tax rate that bears some relation to the mean tax bite inflicted on ordinary toilers doing an honest day's labor. On a lot of their enormous profits, the hedgies and the private-equity types pay 15%, instead of the up to 35% on the pittance earned by the sweat of our brow that we hapless lugs are liable for.
One would think such a proposal would be a no-brainer for Democrats like New York's senior senator, Charles Schumer, who are eternally posturing as friends of the working man and mouthing off about skimming some of the ill-gotten gains of the rich to enhance the common weal.
Ah, but no. Mr. Schumer, who's never at a loss for words, especially when there's a TV camera in sight, seems uncharacteristically constrained in his reaction to this latest wrinkle in the unceasing effort to separate the affluent from their proudest possession -- their money. Mr. Schumer suggests the need for careful weighing of the pros and cons of the proposal, a meditative approach that's quite alien to his usual assertive mode, and other liberal fire-eaters in the Congress apparently have experienced a similar conversion to the novel notion of think-before-you-shout.
A cynic might credit this onslaught of calm rationality to the fact that hedge funds and private-equity operators are big-buck contributors to the campaign kitties of Democrats. And a cynic would be absolutely right. But we want to reassure their various constituencies, those equivocating senators and congressmen are not opposed to soaking the rich; they are opposed only to soaking the rich who are enlightened enough to share the wealth with them.
The tender concern for the financial sensibilities of the worthies who run hedge funds and private-equity outfits is not restricted, in case you were worried it was, by petty partisanship. The Republicans, by and large, are arrayed against increasing taxes as a matter of principle and especially, as a matter of principal, against boosting the taxes of such generous donors to their campaigns as the hedge-fund and private-equity chieftains. An exception, we should note, is Sen. Charles Grassley of Iowa, but then he probably grew up on a farm and so wouldn't know a CDO from a CMO and lacks the unique insight afforded those brave hearts who've engaged in tranche warfare.
Point man for the Republicans on this crucial issue seems to be John Snow, the former secretary of the Treasury. A brilliant choice, we say, for no one is better suited for that role than Mr. Snow, who parlayed an undistinguished career at the Treasury into a quite handsomely remunerative job as chairman of the insatiable private-equity octopus Cerberus Capital Management.
And Mr. Snow is proving just the fellow to eloquently delineate the horrors that will ensue to the free-enterprise system, the economy and the nation's well-being if, to cite one horrifying example, the top 25 hedge-fund managers were able to take home in any given year an average of only some $250 million. The very prospect of such extreme deprivation and cruel diminishment of incentive is enough to make widows and orphans weep, even those too impoverished by rash investments to own anything with which to wipe their tears. |
