HE'S NUMBER 69 on the latest Forbes 400 list of richest Americans and head of Blackstone Group, the world's largest private equity firm specializing in corporate takeovers. He lives in a 35-room triplex on Park Avenue in Manhattan, with second "homes"--mansions, really--in the Hamptons, Palm Beach and Jamaica. His private chef regularly spends $3,000 for a weekend's feasting for him and his wife, including those stone crabs he loves at $400 each. Which works out to $40 a claw.
But comfortable as his life is, Stephen Schwarzman isn't the kind of guy to allow tyranny to go unopposed. "It's a war," he declared in July at the board meeting of a nonprofit organization, according to Newsweek. "It's like when Hitler invaded Poland in 1939."
And what cruel injustice was Schwarzman standing against? Turns out it's all those people who want to tax him to death.
Schwarzman was talking about a widely supported Democratic proposal--now abandoned, naturally--to close a loophole that allows private equity firms like Blackstone to pay taxes at less than half the rate of normal corporations.
Today, the richest 1 percent of Americans takes nearly 24 percent of overall income--nearly tripling their share since 1976 and the most extreme level of inequality since statistics started being kept.In the first nine months of the year, the big six banks in the U.S.--Bank of America, JPMorgan Chase, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley--cleared $35 billion in profits...
The financial sector of the economy accounts for more than a quarter of the profits of U.S. businesses, up from around one-seventh 25 years ago. ..."It's like a cancer that is growing to infinite size, until it takes over the entire body.
But the corporate profit boom isn't leading to an investment boom, at least not investment in the U.S.
Earlier this year, the Federal Reserve estimated that non-financial corporations were sitting on $1.8 trillion in cash and other so-called liquid assets, up 26 percent from the year before, the fastest increase for cash on hand since records started being kept in 1952.Since December 2007, the U.S. economy has lost 5.4 percent of non-farm payroll jobs--roughly one lost out of every 19...
SWEATING LABOR That statistic reveals the old-fashioned secret of the profit boom--corporations are making workers work harder for less. According to the Bureau of Labor Statistics, the output of the U.S. economy rose 4.1 percent in the third quarter compared to the year before, the number of hours worked increased by 1.6 percent, and unit labor costs fell by nearly 2 percent.
AND STILL Corporate America's filthy rich few play the victim--like Schwarzman with his outbursts against "big government" and the terrible injustice of being made to pay taxes at something closer to the rate that working people do.Only...it turns out that Stephen Schwarzman isn't opposed to all "big government."
The Blackstone Group's last big deal before the Wall Street crash in 2008 was the takeover of the Hilton Hotel chain....
when Schwarzman and Co. wanted to refinance, they were negotiating in part with the federal government, in the form of the New York Fed. Which graciously agreed to sell back $320 million of the total Hilton debt at a cost to Blackstone of $142 million....
Probably the worst among Hilton/Blackstone's demands is the speedup--management wants housekeepers to clean 20 rooms a day, a 40 percent increase in work...http://socialistworker.org/2010/12/10/the-few-the-proud-the-rich
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