some of the biggest investors in private equity are pension funds. Those are pensions? Do we need to take our money if we have, if we're lucky enough to have a pension, out of the private markets like that? And if so, where do we put it? - Yeah, I would love to see this conversation 00:23:48 happen among institutional investors. I mean, what they have been flocking into private equity and it's the least transparent, the least accountable, the least responsible of the sectors.

The myth that this was caused by Craigslist or Google drives me bonkers. Throughout the 80s and 90s, private equity firms and hedge funds gobbled up local news enterprises to extract their real estate. They didn’t give a shit about journalism; they just wanted prime real estate that they could develop. And news organizations had it in the form of buildings in the middle of town. So financiers squeezed the news orgs until there was no money to be squeezed and then they hung them out to dry. There was no configuration in which local news was going to survive, no magical upwards trajectory of revenue based on advertising alone. If it weren’t for Craigslist and Google, the financiers would’ve squeezed these enterprises for a few more years, but the end state was always failure.

If private-equity firms cannot be socially responsible stewards of capital, then Congress will need to act. One possible reform would involve fully taxing the advisory and other fees that private-equity investors extract from the companies they own. Another potential reform would impose restrictions on dividends paid out in the two years following a buyout. Since the current system allows private-equity firms to reap much of the positive gains from successful acquisitions, they could also be required to bear some of the liability for a company’s debt when the buyout ends in bankruptcy.