Elizabeth Warren’s war on private equity may hurt the US economy
Center for Freedom and Prosperity Director Dan Mitchell on Sen. Elizabeth Warren’s (D-Mass.) plan to regulate the private equity industry.
While her fellow leftists spent their time immersed in the feud between President Trump and "the squad," Sen. Elizabeth Warren, D-Mass., kept her eye on the prize, continuing her laser-like focus on the populist economic message that has driven her political career.
Warren – joined by a rogue’s gallery of congressional liberals – introduced legislation in the Senate targeting the private equity industry for what she dubbed "legalized looting." The industry is no stranger to being used as a political football. In 2012, it was one of the main weapons in President Obama and his allies' arsenal to undermine Mitt Romney’s career as a successful businessman. Private equity is the practice of buying or investing in troubled businesses with the goal of helping them turn around.
Rather than offer a hopeful vision, Warren’s chosen grievance politics. She's focused on bringing the top down rather than lifting everyone up.
Beating up on financial institutions is not anything new for Warren. She arrived on the national scene in 2011 as the self-professed intellectual founder of the extreme Occupy Wall Street movement that festered in major cities across the country. Fortunately, Warren’s anarchists have faded from public view. Unfortunately, their radical worldview has found a home in the mainstream of today’s Democratic Party.
WARREN LIKENS PRIVATE EQUITY TO 'VAMPIRES' IN PLAN TARGETING WALL STREET 'LOOTING'
Warren’s attacks on free enterprise make for snappy sound bites in a primary field swooning for socialism, but the casualties of "Warrenomics" are real and severe. Her new scheme is a far-reaching broadside against an entire industry that invests half a trillion dollars each year in American businesses.
In Massachusetts alone, the state whose interests Warren is supposed to be representing, there are 245 private equity firms. More than 300,000 of Warren’s constituents collect their paychecks at companies backed by private equity. The Boston Globe reported on an industry study indicating private equity generated record returns for the Massachusetts state pension fund.
The co-sponsors of Warren’s legislation are telling. They include socialist Sen. Bernie Sanders, I-Vt., both co-chairs of the Congressional Progressive Caucus, and half of the squad, Reps. Ayanna Pressley, D-Mass., and Rashida Tlaib, D-Mich.
Welcome to the Democratic Party of 2019, ladies and gentlemen.
It’s difficult to believe, but it wasn’t that long ago that Warren’s presidential ambitions were on life support. After spending the last two years trying and failing to put out fires around her Native American ancestry, Warren’s campaign sputtered out of the gates. Now, halfway through the year, Warren is a permanent fixture in the top five of presidential candidates.
With Sanders and former Vice President Joe Biden’s stock falling, Warren stands to pick up more support on the road ahead. Barring an unforeseen collapse, Warren – along with Sen. Kamala Harris, D-Calif. – are good bets to make it to the final rounds
Warren’s relentless campaigning has earned her praise from unlikely sources. Peter Thiel, the billionaire investor and one of President Trump’s most credible surrogates on economic issues, told Tucker Carlson that he is "most scared" by Warren’s candidacy. Thiel added, "she’s the one who’s actually talking about the economy, which is the only thing — the thing that I think matters by far the most." Tucker himself has also praised Warren’s economic vision, declaring last month, "She sounds like Donald Trump at his best."
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Warren has never paid a political price for beating up on banks and others she deems responsible for income inequality. She has concluded that people are mad and want to take it out on those at the top. Ironically, this message takes away from what was arguably Warren’s strength when she first burst onto the national scene, which was a sense of real understanding about the struggles of middle-class families getting squeezed.
Rather than offer a hopeful vision, she’s chosen grievance politics. She's focused on bringing the top down rather than lifting everyone up. That’s the political calculation she’s bet her entire campaign on, and time will tell how it plays out.