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Progressive Democrats are using Taylor Swift as political leverage against the private equity industry after Swift publicly noted that The Carlyle Group had helped finance a deal whereby Swift lost control of her old master recordings.
Driving the news: Sen. Elizabeth Warren tweeted: "Unfortunately, @TaylorSwift13 is one of many whose work has been threatened by a private equity firm. They're gobbling up more and more of our economy, costing jobs and crushing entire industries. It's time to rein in private equity firms—and I've got a plan for that."
- Rep. Alexandria Ocasio-Cortez tweeted: "Private equity groups’ predatory practices actively hurt millions of Americans. Their leveraged buyouts have destroyed the lives of retail workers across the country, scrapping 1+ million jobs. Now they’re holding @taylorswift13’s own music hostage. They need to be reigned in."
My thought bubble: Private equity excess is a legitimate political issue, particularly when it comes to taxes and treatment of workers. But Warren and AOC are conflating those issues with what is essentially a contract dispute between a wealthy record label and its wealthy artist.
- Carlyle used no debt to acquire its stake in Ithaca, which represents a minority interest without operational control.