Elizabeth Warren Declares War on Private Equity and Our Economy

Democratic 2020 U.S. presidential candidate Sen. Elizabeth Warren speaks to members of the media during a town hall at the Peterborough Town House in Peterborough, New Hampshire, U.S., July 8, 2019. REUTERS/Elizabeth Frantz - RC160373CDD0

The latest targets of Senator and Democratic presidential candidate, Elizabeth Warren, are private equity firms. According to her, releasing the economy from the “stranglehold” of Wall Street will spur economic growth, help small businesses and raise wages. She calls her latest bill the Stop Wall Street Looting Act. This bill would impose regulations, new taxes and legal liabilities that are likely to make it too risky and costly for private equity firms to invest in struggling businesses.

What private equity firms do (a brief explanation)

As the name suggests, private equity firms raise money privately. Their investors are usually institutional investors, like pension funds. They also raise capital from investors who meet a certain set of criteria that allow them to make riskier bets. Private equity firms buy struggling companies or those they believe have a high potential for growth.

Their aim is to fix inefficiencies or speed up growth, and then sell the company. In some cases, trying to improve the health of a company means having to reduce staff or close factories.

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Charles Laverty
Charles Laverty is a contributing writer to USA Herald and entrepreneur focused on health along with wellness. Charles passion is writing and has a knack for covering tough stories that other journalists shy away from, including but not limited to the fitness industry's profiteering over fixing the obestity epidemic. Charles Laverty is an advocate for health, wellness, and fitness. He has a knack for calling out government for bad policies, incompetence, and anti-democratic actions.