Private Equity and Creative Destruction
by David P. Goldman
Any investment firm operating over decades of rapid employment growth will be able to show that the companies it bought added jobs over time. That’s what the academic studies on private equity show in any event, as Jordan Weissmann reports at The Atlantic. More relevant is the alternative. We’ve been there, done that, and don’t want to do it again. Corporate America in the 1950s and 1960s coasted on the postwar monopoly enjoyed by American companies after the destruction of European and Japanese industries. Detroit in the late 1960s had African-American neighborhoods stretching for miles with well-kept single-family homes and manicured lawns; by the end of the 1970s it had turned into a moonscape. The rust belt still hasn’t recovered from the laziness of American capital a generation ago.
Perry and Gingrich need to stop attacking Mitt Romney from the left and start attacking him from the right. There’s certainly plenty of fodder for the horses there.