STATE OF THURSDAY: Washington Is Talking Tough. Wall Street Has Heard This Before.

Washington is again promising to rein in private equity, but the Daily Caller's columnist argues the industry's record of protecting its tax advantages gives reason for doubt. Congress passed a bipartisan housing law this year barring such firms from buying single-family homes, though institutional investors may keep the properties they already own. Sen. Elizabeth Warren reintroduced her Stop Wall Street Looting Act, which would hold private equity firms liable for some debts of companies they acquire, and she has joined Sen. Josh Hawley on a bill aimed at consolidation in health care.

The columnist points to carried interest, which taxes fund managers' share of investment gains at the lower capital-gains rate, as the loophole that has survived every challenge. In 2007, major firms and their trade group retained 20 lobbying firms, and Blackstone spent $4. 9 million that year, according to ProPublica. The reform died in the Senate and failed again in 2010. In 2022, then-Sen. Kyrsten Sinema made her backing for President Biden's Inflation Reduction Act conditional on removing a provision narrowing the break, and Democrats complied. President Trump campaigned against the loophole, but his 2017 tax cuts left it largely in place.

Summarized by PolitiKool from Daily Caller’s reporting. Read the full story at Daily Caller →