This is part of an ongoing effort by the SEIU to highlight the fund-raising done for McCain by Henry Kravis, of the private equity firm Kohlberg Kravis Roberts (KKR), which the union argues has gamed the tax code to make big money during the buyout boom.
Kravis is being joined as an organizer of McCain's 21 Club fund-raiser by his fellow investment fund big Ted Forstmann, hedge-fund head Paul Singer (a former Rudy Giuliani supporter), Merrill Lynch CEO John Thain and JP Morgan executive James Lee.
Speaking about the current recession Kravis told the Wall Street Journal, "Economic environments like these provide opportunities. We at KKR have made some of our best investments in periods like these".
On July 17th, the SEIU will be holding a global action day against private equity firms such as the Amsterdam-listed KKR. There will be demonstrations in 100 cities and 25 nations. The rallying cry will be: Take back the economy from buyout firms that have exploited tax loopholes to amass great wealth at others’ expense.
“We think the buyout industry and the way it operates are systematic of what’s wrong in this economy,” said Stephen Lerner, director of the union’s private equity project. “We want to make them responsible corporate citizens.”
The union also argues that the attention on private equity firms has been justified by the huge role they now play in the economy. Companies owned at least in part by Kohlberg Kravis employ more than 816,000 people, according to the firm’s Web site — more than the population of San Francisco.
According to the SEIU, KKR founder Henry Kravis made about $51,000 per hour in 2006, yet he would pay a lower tax rate on his profits than nurses and teachers on their incomes of $50,000 per year.
The following is a press release from the Service Employees International Union.
Workers, 'Billionaires for Bush' to Gather Outside McCain's Big Money Private Equity Fundraiser in Manhattan
Controversial buyout baron Henry Kravis to host event
Advocates for a fairer, better economy, workers, and political improv troupe "Billionaires forBush" will gather in front of the posh 21 Club in Manhattan on Tuesday to protest John McCain's support for tax loopholes for some of the wealthiest buyout executives in the country. The $28,500 a ticket luncheon is being
organized by some of the most controversial names in business, including
buyout baron Henry Kravis.
John McCain has said he does not support closing tax loopholes for
hedge fund managers and buyout industry executives such as Kravis, who have
pocketed billions of dollars by paying a lesser percentage of their income
to taxes than many regular working Americans. Besides helping to organize
Tuesday's event, Kravis has been a major fund-raiser for John McCain
throughout his campaign for president.
McCain's tax plan also includes two huge tax cut giveaways for American
corporations--lowering rates from 35% to 25% and adding other new
deductions. KKR companies stand to make millions of dollars off the new
cuts. According to the Center for American Progress, "The centerpiece of
Sen. John McCain's (R-AZ) tax plan is two huge tax cuts for American
corporations, including utility and energy companies." A CAP analysis finds
that McCain's tax policy--which lowers corporate tax rates from 35 to 25 %
and makes equipment and technology investments immediately
deductible--would give a single KKR portfolio company, Energy Future
Holdings (formerly TXU), a $49 million tax cut.
The country's fastest-growing union - the Service Employees
International Union - recently launched a multi-tier global campaign
directed at world leaders and legislators, pressing for fairer taxation of
the multi-trillion-dollar private equity industry, with an eye toward
shaping the debate during the U.S. presidential race.
Dozens of protesters fighting for a fair economy; performances by the
"Billionaires for Bush."
June 10 - 6:30 PM
The 21 Club -- 21 West 52nd St.
New York City, NY