Wednesday, April 30, 2008

Carlyle Number One at Numerous Things


Private Equite International Magazine rated The Carlyle Group number one in funds raised last year. The politically connected private equity underwriter (PEU) raised $52 billion for investment purposes. It beat out Goldman Sachs, TPG, and KKR for the top spot. While Carlyle is good at raising funds and earning stellar returns, it has another skill. The Pennsylvania Avenue PEU can shut the media out like no other firm. Consider the following:

1. Boeing canned Carlyle's Vought Aircraft Industries from a joint venture as it was the sticking point for Dreamliner 787 production. Despite Vought's paying Carlyle $2 million a year for management services, the JV had liquidity problems which prevented it from ramping up production. That came from the mouth of Vought's CEO. How did Carlyle sell Boeing's yanking their share of the joint venture? Vought spokeswoman Lynne Warne said “This was purely a financial transaction.” Hogwash! (As for value from that multimillion dollar management fee, Vought just agreed to pay $1.5 million for employment discrimination. Its screening process discriminated against women, black men, and Asian men.)

2. Carlyle sold Landmark Aviation and Standard Aero to Dubai Aerospace with virtually no media coverage. Some fifty domestic airport operations went to a Middle Eastern sovereign wealth fund with barely a peep from the business media. This deal was sandwiched between the Dubai Ports World brouha and the contentious Nasdaq sale to a Dubai firm. It closed around the time President Bush signed a new law "strengthening the oversight of acquisitions of U.S. companies by foreign firms." It seems that law facilitated investment more than anything else.

3. Carlyle's LifeCare affiliate lost 24 patients after Hurricane Katrina. Their attorneys blamed rogue clinicians first. When that strategy failed, they pointed their finger at the feds. Carlyle claims their long term acute patients became wards of the federal government as soon as FEMA evacuation teams set up in New Orleans. After failing patients in one of twenty on LTAC's, the PEU purchased ManorCare with over 500 facilities, mostly nursing homes. None of the this came up in the media during coverage of the purchase. Given their track record of failure, no Congressional committees asked how Carlyle planned to protect patients in future disasters. It must help to have a Pennsylvania Avenue address!

Sunday, April 27, 2008

Carlyle's Red & Blue Connections


The lobbying arm of The Carlyle Group has a distinctly bipartisan flavor. The infamous private equity underwriter flashed its red and blue credentials this past week. News reports indicated chief lobbyist, David Marchick, testified before a Senate Committee on foreign investment in the U.S. Mr. Marchick worked for many years with Bill Clinton, beginning in Arkansas and ending in the White House. Private Equity Hub reported on David's new assistant in its piece "Carlyle Bolsters Lobbying Team":

Bryan Corbett has joined The Carlyle Group as a principal on the firm's Government and Regulatory Affairs team. He will be based in Washington DC, and will report to David Marchick. Corbett most recently served in the Bush Administration as a Special Assistant to the President for Economic Policy and as Senior Advisor to Deputy Secretary Robert Kimmitt at the Treasury Department. He also served as Majority Counsel on the Senate Banking Committee.

Carlyle has both American political dynasties covered, Marchick from the Clinton's, and Corbett for the Bush's. Guess which Senate Committee heard the testimony of Carlyle's chief lobbyist? It would be the same Senate Banking Committee mentioned in Mr. Corbett's bio. Coincidence or intelligent design?

David's testimony is laughable from several perspectives. After the usual compliments, honoring, and boot licking, Mr. Marchick proceeded to talk about the review of foreign purchases of U.S. assets, complete with a reference to Dubai Ports World. He neglected to mention the sale of two Carlyle aviation companies to Dubai Aerospace. The transaction occurred between the failed Ports deal and the NASDAQ, both of which broadly made the news. How did Carlyle keep the sale of operations at over 50 U.S. airports quiet? Now, that takes connections as well as the leverage of corporate advertising on behalf of over 1,000 companies.

Marchick called for the usual voluntary code of conduct for investment firms, both foreign and domestic. He saw a dark cloud on the horizon, citing numerous instances where other countries blocked foreign investment. Isn't that their sovereign right, even the result of democratic processes? One deal involved New Zealand blocking a potential investment from Dubai in the Auckland airport. That would be the same Dubai Aerospace, the sovereign wealth fund that bought Landmark Aviation and Standard Aero from Carlyle back in August 2007.

This all points to Carlyle's ability to manage deals regardless of the political environment. This is also how they keep their good name. Know or employ the right people. Use those contacts to grease deals or stuff negative news. But most of all, stifle any real oversight by offering "voluntary codes of conduct" solutions. Did we learn anything from Enron or the current credit meltdown? Will Carlyle keep their preferred private equity taxation on carried interest? What will happen with sovereign wealth funds, one of which owns 7.5% of The Carlyle Group. Stay tuned, the board is stacked in the Pennsylvania Avenue PEU's favor. That's exactly what co-founder William Conway wants.

Who ever heard that a Carlyle joint venture botched the job so badly, Boeing nudged them out of their new Dreamliner production? After the hullabaloo over Hurricane Katrina and its aftermath, who knows the hospital with the largest patient death toll in New Orleans belonged to a brand new Carlyle affiliate, LifeCare Hospitals? Very few, my friend. And Carlyle likes it that way. They do have their good name to maintain.

Friday, April 18, 2008

PEU Driven Domestic Policy


No matter who wins the White House this fall, high dollar corporate donors will have direct access to the President's ear. The pressure to privatizate more government services will likely grow. How might some of these requests influence policy? Below is one David Letterman like dream scene:

President John McCain sits in the Oval Office with the head of the Veterans Administration. The crimson faced Chief Executive spit out his nail-like words. "Your budget increase is shit. It's fucking unacceptable. How dare you bring this crap to me!"

"But sir, we have to pay for the benefits promised to the men and women who agreed to serve," pleaded the senior bureaucrat. "Their war injuries need lifetime treatment."

"We don't have to do any God damned thing. Fuck them and fuck you. Get out. Get the hell out! And don't come back. I'm privatizing your ass!" The Chief Executive barked out an order. "Get me Ken Mehlman on the line!"

"Ken, I need HCA to buy out the VA system. Don't worry, I'll make KKR a good deal on the purchase price and guarantee long term revenues. You can hold it a few years and spin it off for billions more than you paid. And yes, I'll veto any bill that increases the taxes you patriotic private equity boys pay on carried interest. Yes,, it is a new kind of capitalism."

Thursday, April 17, 2008

Ken Mehlman Joins PEU Boys, Celebrate Good Times, C'mon!


Ex-Republican National Committee head Ken Mehlman parlayed his political experience into a high dollar job with Kohlberg, Kravis & Roberts, a huge private equity underwriter (PEU). PRNewswire reported:

Kenneth B. Mehlman, noted counselor on national legislative and public affairs initiatives, will join the firm (KKR) as Managing Director and Head of Global Public Affairs, a new position. Mr. Mehlman will focus on constructive outreach to the numerous stakeholders of KKR and its portfolio companies around the world, including relationships with governments, third parties, and NGOs.

Translated, it means Ken will use his insider political influence to steer large amounts of government work to KKR subs. The military industrial complex morphed into a government industrial monstrosity (GIM). Given the GIM's rage filled growth, one might think it's on steroids. Ken's background as a pusher of candidates certainly qualifies him to supply that list of governments, third parties and NGO's.

Wednesday, April 16, 2008

Carlyle JV Partner, Billionaire Bob Johnson Slams Obama


CNN's Jack Cafferty asked the following question yesterday:

What is your reaction to BET founder and Clinton supporter Bob Johnson saying Barack Obama wouldn’t be where he is if he were white?

Out of 191 comments, only one knew Robert L. Johnson was affiliated with the politically connected private equity underwriter (PEU) known as The Carlyle Group. Derwin Jones got the relationship wrong, but at least he sat in the correct ballpark. The billionaire's RLJ Companies did a joint venture deal with Carlyle in December 2005. Nearly a year later local community banker Bob Johnson met with President George W. Bush. But back to Hillary Clinton and her presidential aspirations.

Mrs. Clinton recently spoke at Allison Transmission, another Carlyle affiliate. Two of her husband's ex-employees, Mack McLarty and David Marchick, sit on the infamous PEU's payroll. First, Carlyle stooge Sen. Evan Bayh comes to Hillary's aid. Now it's PEU Bob Johnson to the rescue on the race front. How many more Carlyle Buffalo Soldiers are needed to clear the range for Hillary?

Grab Your Buyer Beware Boots in Pharma's New Wild West


If past behavior is indicative of future performance, hold onto your buyer beware boots. Not only can airlines treat customers like prisoners and not offer refunds, drug companies can manufacture data on the efficacy of their drugs. The New York Times reported:

The drug maker Merck drafted dozens of research studies for a best-selling drug, then lined up prestigious doctors to put their names on the reports before publication, according to an article to be published Wednesday in a leading medical journal.

The Journal of the American Medical Association said the analysis showed that Merck had apparently manipulated dozens of publications to promote Vioxx.

“It is clear that at least some of the authors played little direct roles in the study or review, yet still allowed themselves to be named as authors,” the editorial said.


Combine this with a new Food and Drug Administration rule relaxation, and America faces the prospect of more drug company fiction to increase sales, revenues and profits. The FDA plans to allow drug companies to market "off label" uses of their products as long as an article on the practice has been published by a trade magazine.

Let's see, if they gamed the old system with all its controls, what will they do with a virtual Wild West for off label indications? I smell some snake oil coming, and guess who's ready to help? An affiliate of the infamous, politically connected Carlyle Group specializes in helping big pharma market their goods.

Sunday, April 13, 2008

Clinton's Savior is Carlyle's 007


After Barack Obama's stumble on people in small towns being "bitter", a crowd gathered to kick the presidential hopeful while he lay on the ground. Barack could clearly see Hillary and John McCain, but who was the third guy, the one who said Democratic super delegates needed to take these remarks into consideration? Here are your hints:

1. He's also a Senator, so much for professional courtesy.
2. After building the best organization in Iowa and two weeks after announcing his presidential aspirations, this gentleman dropped out of the race.
3. Seventh place on his lifetime donor list (at $75,000) is The Carlyle Group, an infamous, politically connected private equity underwriter (PEU).
4. His wife is on the Board of giant health insurer WellPoint. The family grossed $1.5 million from cashing in her stock option awards. The day after I e-mailed the Senator with this information, he dropped out of the race.
5. He recently went to the United Arab Emirates to investigate sovereign wealth funds investing in U.S. companies. The aforementioned Carlyle Group sold 7.5% to Abu Dhabi's government owned investment fund for $1.35 billion.

Got it? It's the esteemed Senator from Indiana, Evan Bayh, or is it Buy?

Hillary Promises a Double While Carlyle Hosts


Presidential hopeful Hillary Clinton spoke of the need for military manufacturers to produce domestically for economic and security reasons. Hillary said she would launch a "comprehensive review of our defense industrial base" to determine "where U.S. capabilities are lacking." It would involve doubling the Defense Department's basic and applied research operations.

The private equity boys always love a double, so Mrs. Clinton's remark likely got their attention. That and an affiliate of The Carlyle Group hosted her visit. Hillary spoke at the Allison Transmission plant that makes the drive train for military vehicles. Did Mack McLarty or David Marchick set it up? Mrs. Clinton already has Carlyle joint venture partner Bob Johnson in her corner. May the best franchise win! (Mr. Marchick already donated $2,000 toward the Clinton campaign, but he may need to update his employer information!)

Friday, April 11, 2008

Peter Pace Hits Trifecta


Retired General Peter Pace continues his streak of appointments in the private sector. Neohapsis tapped Pete for a spot on its Board of Directors. His compensation was not disclosed and is not publicly available given the firm's ownership by two private equity underwriters (PEUs), Paladin Capital Group and Trident Capital. I wasn't sure the General had time for another job given his earlier commitments:

In January, SM&A Strategic Advisers named Pete as their President and CEO. In addition, he nabbed a spot on the parent company board. His first year compensation is $560,000 and full time work is not required.

March saw Gen. Pace get appointed to President Bush's Oversight Intelligence Board.

April found Behrman Capital, a private equity underwriter (PEU) in need of an operating partner, one to help grow their defense and aerospace business. The ex-chair of the Join Chiefs of Staff filled the bill.

That's quite a winning streak. It will be interesting to see how many more jobs and board appointments come Peter's way, courtesy of the government industrial monstrosity.

Thursday, April 10, 2008

New Carlyle JV to Go After EPA Brownfields Money?


The Carlyle Group just announced a $59 million joint venture with a real estate development outfit in North Florida. BizJournals (via Conde Naste Portfolio) reported:

D.C.-based Carlyle Group has committed $50 million of equity capital and Jacksonville, Fla.-based Hassan & Lear Acquisitions Ltd. has committed $9 million to the joint venture, which will mainly acquire, remediate and reposition old industrial properties, as well as explore a wide range of real estate investment opportunities throughout the Southeast.

The joint venture's first acquisition of 1,800 acres cost $15 million. The company plans to turn traditionally unusable and unprofitable properties into prime real estate development sites, according to the company.

They do so by acquiring "brownfields." The Environmental Protection Agency happens to have funding for cleanup and development of such areas. The feds provide tax incentives, capital attraction incentives, and financing support. There's even an opportunity to get Housing and Urban Development money! With Carlyle's connections, might an earmark be in order for that Jacksonville area property? Time will tell how big the bonanza is for the politically connected private equity underwriter (PEU).

Wednesday, April 9, 2008

Carlyle Takes Third Hit


The Carlyle Group lost a bit of its luster the last few weeks. It began with the collapse of Carlyle Capital Corporation, a publicly traded investment on the Amsterdam Exchange. Then Boeing Corporation snatched back an under performing supplier from Vought Aircraft Aviation, a Carlyle affiliate. On its website, the Firm Profile states:

Carlyle focuses on sectors in which it has demonstrated expertise: aerospace & defense, automotive & transportation, consumer & retail, energy & power, financial services, healthcare, industrial, infrastructure, real estate, technology & business services and telecommunications & media.

Despite Vought's paying the private equity firm over $2 million a year in management fees, the company couldn't work out the kinks in their joint venture with Alena. Management cited a liquidity problem that prevented them from ramping up their production lines fast enough. Boeing grew tired of the delays, already projected at eight months, and snatched up Vought's interest in the joint venture. Alena got to keep theirs. That looks bad for Carlyle. Just days after announcing the takeover, Boeing announced the delay ballooned to 15 months. They blamed slow progress on assembly and continuing problems with suppliers for the delays.

Carlyle Capital Corporation is permanently grounded along with Vought's interest in the Alena joint venture. Boeing's signature plane will stay Earth bound an extra 15 months due to another Carlyle failure to deliver. Did I mention the twenty four patients who died after Hurricane Katrina in another Carlyle affiliate, LifeCare of New Orleans? Three major blows to Carlyle's invincible aura, only one of which is public. They do an excellent job of "maintaining their good name."

Tuesday, April 8, 2008

Carlyle's Conway Casts Light


“I don’t want a fair fight, I want something that is tilted way in our favor.”-William Conway Jr., co-founder of The Carlyle Group, a huge private equity underwriter (PEU)

Yes, that sums up The Carlyle Group and its aim to be a one stop shop for the government industrial monstrosity.

Sunday, April 6, 2008

Buyer Beware, Government Enforced!


The state of pharmaceutical liability must have drug executives partying on their 250 foot yachts. The Bush administration argues that once a drug is approved by the Food and Drug Administration, injured patients have few legal rights to sue the company. The circular argument goes like this:

1. An underfunded, overwhelmed FDA reviews drug efficacy studies conducted by the companies wanting to sell those same drugs.

2. They agree on product information, including warning labels.

3. If a patient is injured, the company is protected because the FDA approved the product. This protection occurs even if the drug maker lied on the label.

The clear message to the American public is "take the system we have, just as it is. You have little recourse as a consumer." While 80% say birth control should be covered by health insurance, less than 33% paid for birth control prevention for women. So most of those women injured by Johnson & Johnson's contraceptive patch got their prescription the old fashioned way. They paid for it!

Did I mention the same Bush administration plans to allow drug companies to market off label uses for the drugs, as long as they've been published in a trade journal? Or that 80% of drugs America's drugs or their main ingredients are imported, much of it from China? We know their reputation for quality. Produce it cheaper or die! This unfortuantely extends to the downstream consumer. Chinese management evicted the "drive out fear" model taught by Dr. W. Edwards Deming, the world's leading quality guru.

America's government industrial monstrosity leads us deeper into the New Guilded Age. Hang onto to your bootstraps, it's going to be quite the ride as the Bush administration protects and promotes corporate health!

Moneychanging Carlyle



The infamous, politically connected Carlyle Group bid on international money changer De La Rue according to the TelegraphUK. It plans to sell it cash systems business. Carlyle's employees include a who's who list of ex-government appointees and elected officials. They leverage those political contacts to land deals, earmarks, and launch public/private partnerships. The private equity underwriter could soon add De La Rue to their list of over 1,000 affiliates in a wide range of industries.

De La Rue, which has a market value of about £1.4bn and prints one in five of the world's currencies, is pursuing a sale of its other major division, which produces cash handling equipment and banking software.

It looks like moneychanging will ratchet up to a new level in our hallowed halls of government. I say toss them out, regardless of their red or blue affiliations. Carlyle added some high level blue talent this past year. They clearly wish to remain on the tit of the government industrial monstrosity, regardless of which franchise captures the electoral vote this November. Remember the popular vote doesn't matter. A pox on both their houses.

And those hallowed halls of government? They're lined with the modern day moneychangers, lobbyists, influence peddlers, and politically connected PEU's. It's time for some table tossing.

Thursday, April 3, 2008

Peter Pace Promoted to PEU


General Peter Pace continued his great string of appointments. In January, SM&A Strategic Advisers named Pete as their President and CEO. In addition, he nabbed a spot on the parent company board. March saw Gen. Pace get appointed to President Bush's Oversight Intelligence Board. April found Behrman Capital, a private equity underwriter (PEU) in need of an operating partner, one to help grow their defense and aerospace business. The ex-chair of the Join Chiefs of Staff filled the bill.

Apparently Behrman needed lots of help as it gave Peter numerous jobs. Fox Business reported:

General Pace has been named Chairman of the Board of Behrman portfolio company Pelican Products, Inc., a Torrance, CA based global leader in the design and manufacture of advanced lighting systems and virtually indestructible cases for protecting valuable equipment. He has also been named a Director of portfolio company ILC Industries Inc., a defense electronics and engineered softgoods provider based in Bohemia, NY.

It's a good thing Gen. Pace doesn't have to work full time as President of SM&A Strategic Advisers for that $560,000 first year compensation. That gives him time to help Behrman and its subsidiaries. Eisenhower worried about the looming military industrial complex, which has since morphed into the government industrial monstrosity. General Pace is but the latest example of the fox in the chicken house. How ironic his latest large money making scheme was revealed by Fox News' Business franchise.

Tuesday, April 1, 2008

Carlyle Affiliate Does April Fool's on State of Texas


The Carlyle Group purchased Vought Aircraft Industries in July 2000. In 2004, the state of Texas gave Vought $35 million as an incentive to create 3,000 jobs. Later, those plans changed. According to Vought's SEC filings:

In February 2004, we announced plans to consolidate portions of our manufacturing operations to Dallas and Grand Prairie, Texas. The consolidation plan, as originally designed, was intended to renovate and modernize the Dallas facilities, close the Nashville and Stuart sites and reduce the size of the Hawthorne site. In December 2005, we announced our intention to keep the Nashville and Stuart facilities open to support certain programs whose future deliveries did not justify the costs to move the programs to Dallas and these plans were finalized in April 2006.

That same month, Vought Aircraft announced it would eliminate 600 Texas jobs vs. adding the promised 3,000 new positions. Two years of interest earned on $35 million, say at 5%, meant a $3.6 million boon to Vought's financial position. One might expect that to secure those Texas jobs.

So what happens if they don't meet their targets? Time is running out on those 3,000 new positions, promised by 2009. A Dallas Morning News piece offered this several years ago:

Vought executives said they still expect to reach their job-creation goal, but they provided little detail about how they would do so.

Neither does their just issued annual report shed any insight. While it shows the Texas $35 million in grant monies as a liability, there's no footnote, unlike South Carolina 's $66.7 million. Vought just announced the sale of their South Carolina joint venture to Boeing, mostly due to poor manufacturing performance. Boeing sought control to get production back in line.

So where will these 3,600 Texas jobs come from? The company has little time to manufacture the 3,000 jobs promised plus the 600 lost. The Texas Congressional delegation rode to the rescue with a $2.4 billion earmark that helps Vought.by extending the C-17 program and its 650 Texas jobs. Otherwise, the company fallls further into the hole relaitve to those promised targets. What happens if it fails? The Dallas Morning News article shed some light on that question:

Penalties may apply if Vought fails to maintain the required jobs level through 2019. But the maximum amount it would need to refund is $33 million, potentially netting Vought a $2 million gain.

Not only do they pocket $2 million, but they can earn interest on the $35 million for five years, as well as the slowly declining principal between 2010 and 2019. At a conservative 5%, Vought can earn $9.7 million in interest income for 2004-2009. Over the next ten years, the job reneger could pocket an additional $23.1 million in interest income, even while returning $3.3 million per year to TEI coffers. That totals $32.8 million in interest earned during the life of the grant. Adding the $2 million freebie and Vought can earn $34.8 million from Texas taxpayers for absolutely nothing.

Governor Rick Perry had this to say when announcing the award to Vought in Februray 2004:

“Taxpayers can know that this is a wise investment of public dollars because, once this expansion is finalized, the annual return will be more than twice the original investment.”

Some four years later, it's clear Texas citizens have been April Fooled.

Carlyle's Reputation as Operator Takes Hit




Vought Aircraft, an affiliate of the politically connected Carlyle Group, encountered major problems, enough that Boeing will purchase their part of a joint venture business to get things functioning properly. The maze of contractors and subcontractors bit Boeing in the rear assembly in the production of its 787's. The Dallas Morning News article stated:

Boeing Co. said Friday that is buying Dallas-based Vought Aircraft Industries Inc.'s share of a joint venture that does some sub-assembly on Boeing's new 787 Dreamliner jet.

Vought has had trouble keeping up with Boeing's schedule for construction of the 787, and both firms said the new arrangement should ease those problems.

Recall Vought's shopping around for economic development funds in Texas and South Carolina not terribly long ago? In 2005 Vought had $52.2 million in proceeds from government grants. Another $17.4 million fell in their lap in 2006. Their financial statements show grant monies from South Carolina at $66.7 million and Texas donating $35 million.

Vought will continue to make the aft fuselage section of the plane, but will no longer handle integration of fuselage sections with other parts.

Vought spokeswoman Lynne Warne said “This was purely a financial transaction.”

I think not, Ms. Warne. Vought's major customer in effect fired the Carlyle affiliate for poor performance. A Seattle Times piece provided more information about the problems.

Vought had "been sort of a bottleneck on the production ramp-up and a poor performer in terms of managing to put those sections together at a fast pace," said Peter Arment, an analyst with Greenwich, Conn.-based American Technology Research. "This is part of the program that Boeing thought their suppliers would be able to handle. Their hand was more or less forced, given the performance with this joint venture."

But the first assembled Dreamliner fuselage arrived from South Carolina with much of its internal wiring system not completed, triggering a string of delays that have yet to be overcome.

"This was born of necessity rather than strategy," said aviation analyst Richard Aboulafia of the Teal Group in Fairfax, Virginia. "Boeing didn't do an adequate job of verifying their capabilities."


Vought, you're fired from the integration process! Of course, there's always the spin. This is from the company's president and chief executive officer Elmer Doty:

"This seamless transition of joint venture ownership will build upon the strong foundation already established within Global Aeronautica," he said. "Selling our interest has no impact on our adjacent facility, where the Vought 787 team remains focused on manufacturing composite fuselage sections for this incredible airplane.”

Mr. Doty previously sang a different tune on this project.

Last October, Doty acknowledged that Vought was the highest-risk supplier on the 787 industry team. At the time, Doty attributed Vought's struggles to an internal liquidity crisis in 2006 that prevented the company from ramping up investment in the 787 programme at a sufficient rate. Boeing had previously appointed vice-president Scott Strode to take over management responsibility for Vought's role in the 787 programme.

Carlyle just witnessed the failure of Carlyle Capital Corporation. Adding poor performance in one of its long time subsidiaries doesn't reflect well on the firms ability to run strong operations. That's from a quality, not a financial perspective.

But we've seen Carlyle spin the seemingly unspinnable before. After losing 24 patients in their LifeCare facility in New Orleans, attorneys blamed clinicians first. When that didn't work out, they shifted to pointing the legal finger at Uncle Sam. LifeCare claims their patients became wards of the federal government as soon as FEMA evacuation teams set up in New Orleans.

After failing patients in one of twenty one LifeCare facilities in a time of crisis, Carlyle spun a web of silence. One might expect something this significant to make President Bush's Lessons Learned report. Fran Townsend's tome provides not a word on LifeCare's patient deaths, the largest number of any hospital post Katrina.

The topic never arose last fall as the private equity underwriter (PEU) sought ManorCare with its 500 mostly nursing homes. One might expect past poor performance of a Carlyle health care affiliate to have some bearing on the planned purchase. Congressional hearings avoided the topic. Bush's FTC and Justice Department never got back to me on my concerns. Carlyle's Santa, also known as Uncle Sam, delivered ManorCare just before Christmas last year.

I can only conclude Carlyle is smooth operator but not a quality one. There's ample evidence of both. At least they get to keep that $2.1 million annual management fee from Vought.