Congress: PE isn’t doing what we want it to do. Time to investigate.

Posted by Marc Hodak on April 25, 2010 under Politics | Be the First to Comment

The WSJ reports:

Hugo Boss reversed a decision to shut down a factory in Ohio, succumbing to an aggressive union-led campaign against the German fashion house and its private-equity owners.

Of course, unions have every right to resist the loss of jobs.  They also have the right, recently enhanced, of lobbying the legislature to affect union-friendly rules, even if said rules constrain the freedom of employers, consumers, and non-union workers.

But what kind of politician would threaten whole, productive sectors of the economy in order to protect a few hundred jobs?  A politician beholden to union support:

Top Democratic political officials in Ohio including U.S. Senator Sherrod Brown and Governor Ted Strickland voiced their support for the union. Mr. Brown announced hearings that had been scheduled for next week on the role of private-equity firms and the U.S. economy.

Senator Brown of Ohio, of course, could look up the “role of private equity firms and the U.S. economy” in a textbook on economics.  What the reporter really meant is that Senator Brown of Ohio is looking for a way to intimidate PE firms into sacrificing their investors’ interests in order to serve his parochial, political interests.