When talking about Blackstone (NYSE: BX), people usually refer to Stephen Schwarzman. However, there is actually a cofounder of the firm; that is, Peter Peterson.
Although, he's not a pure finance junkie. Some of his prior gigs include: Chairman of the Federal Reserve Bank of New York, the CEO of Lehman Brothers (NYSE: LEH), the CEO of Bell and Howell, and even the Secretary of Commerce (under President Richard Nixon).
And, of course, he's a very wealthy man. He cashed out $1.8 billion from the Blackstone IPO.
OK, so what's next? Well, he has formed the Peter G. Peterson Foundation. Basically, he wants to create a platform to deal with major issues, such as Social Security, budget deficits, education, energy, the environment, and the spread of nuclear weapons.
If anything, the foundation won't lack for resources. After all, Peterson has pumped a cool $1 billion into it. Apparently, he's prepared to pump more money into it.
I think it's good to have a foundation that's not captive to special interests. More importantly, the world does face many challenges.
But there are some ironies here. First of all, Peterson has continually warned against fiscal irresponsibility and has talked about financial implosion (he is the author of the book Running on Empty: How the Democratic and Republican Parties Are Bankrupting Our Future and What Americans Can Do about It). Yet, it hasn't happened. If anything, he's done quite well for himself.
Next, as the New York Times has pointed out, Peterson has benefited nicely from the low-tax rates on private equity. Hey, might higher taxes on private equity been a way to help out the country with its fiscal ills?
Tom Taulli is the author of various books, including The Complete M&A Handbook
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Reader Comments (Page 1 of 1)
2-17-2008 @ 10:16AM
BizIntel said...
I like to see someone this wealthy start something like this. All of the items that the foundation is aimed to address are things that need both focus and resources.
However, I think the important thing (as you mention) is that the foundation remain impartial when it comes to its mission. This means taking extra measures to ensure that special interests don't have sway over decisions the organization makes. E.g., if an effective measure to curtail the deficit is to raise taxes on private-equity (which will likely happen anyway) then this should remain on the table as an option. Doing so will ultimately boost the credibility and effectiveness of the foundation.
Cheers,
BizIntel
http://www.evaluatingstocks.com
2-23-2008 @ 1:54PM
William E. Donoghue said...
If Peterson simply reforms retirement saving by allowing investors to choose between IRA-like 401(k) and other tax-deferred account mediocre mutual fund choices that will not take defensive action but will profit personally to even simply "go to cash" during the probably bear market and convert that money at lower tax rates while unemployed in the coming year to Roth IRAs, he would collect as much as $5000 billiion dollars in deferred income taxes at no cost to investors who already owe those taxes. Congress and the Treasury could help with low-cost incentives to simplify the process.
That's a good cash pool for the Treasury to start with in resolving some of our country's woes.
Bill Donoghue
2-25-2008 @ 4:47PM
David Dill said...
A thankless job------but somebody's gotta do it !