Private Equity, Public Damage

The executive summary describes the private equity (PE) business model as one of 'legalized looting,' where firms use aggressive cost-cutting, excessive fees, and debt-funded dividends to extract short-term value from acquired companies. It highlights that these practices increase bankruptcy risks and are subsidized by a tax code that provides loopholes, such as carried interest, which benefit wealthy executives while burdening workers and the environment.

• Private equity firms utilize aggressive financial-engineering strategies, including mass layoffs, excessive management fees, and debt-funded dividends, which prioritize short-term extraction over long-term company stability and can harm workers, consumers, and communities.
• Companies taken private via leveraged buyouts are significantly more prone to failure; one study of nearly 500 public companies found they were 10 times more likely to go bankrupt than comparable firms not acquired by private equity.
• The private equity industry is subsidized by the tax code through loopholes and preferential rules, such as the carried interest loophole, which allowed eight executives from Blackstone and KKR to save $335 million in taxes over five years.
• The industry is seeking to restore an expired business tax break on loan interest from the 2017 Trump-GOP tax law, which would increase the amount of destructive debt placed on acquired companies.

APA

Private Equity Stakeholder Project (2025). Private Equity, Public Damage. https://pestakeholder.org/reports/private-equity-public-damage/

Chicago

Private Equity Stakeholder Project. Private Equity, Public Damage. 2025. https://pestakeholder.org/reports/private-equity-public-damage/.

Wikipedia

{{cite report |author=Private Equity Stakeholder Project |title=Private Equity, Public Damage |date=14 February 2025 |url=https://pestakeholder.org/reports/private-equity-public-damage/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{privateequitystakeholderproject2025private, author = {{Private Equity Stakeholder Project}}, title = {{Private Equity, Public Damage}}, institution = {Private Equity Stakeholder Project}, year = {2025}, month = feb, url = {https://pestakeholder.org/reports/private-equity-public-damage/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }