Sunday, August 1, 2010

David Rubenstein on Charlie Rose

Carlyle Group co-founder David Rubenstein spoke to Charlie Rose. Bloomberg gave a summary of the interview. My highlights are below:

Economy & unemployment- low growth, employment not coming back anytime soon.

Taxes- Only taxing a certain part of society isn't fair. All Americans should pay, even those less than middle class. The Deficit Commission will sort this out. Their recommendations deserve an up or down vote.

Stimulus- Wasn't not big enough, some additional stimulus needed but won't pass prior to elections

Business investment- Have $1.8 trillion on the sidelines, don't have confidence to put it to use.

Healthcare- Won't know if the bill works for quite some time, as it has delayed implementation

Financial reform bill- Requires over 60 additional studies. Doesn't like complexity. Businessmen want clarity, need to know the rules to make a profit, create jobs and wealth for the country.

Business community- a lot of people are concerned about some aspects of the President's programs. He'll have to get it back by reaching out to business community. The administration could add a CEO. executive or entrepreneurial type to his Cabinet. Problems between the White House and business community are more than a communication problem.

Carried interest taxation- 20% of deal profits go to private equity firm. Historically, they have been treated as capital gains.

Global private equity- Firms are based in America, don't destroy this "domestic" industry.

Private equity image- People who make a lot of money and don't pay their fair share of taxes and don't create as much value as we say we're creating. So we have to do a better job of explaining the jobs we've created, the companies we've made better.

Sole power- U.S. is dominant economic, political, and military power. May not be the case in ten years. Need stronger relationships with developing countries/emerging markets.

Sprinting to the finish- more active, more heavily scheduled. It's not work, love what I'm doing.
There's irony in using President George W. Bush's "sprint to the finish" line. The Carlyle Group made out like bandits during the Bush years. They're ringing the register before carried interest taxation goes away. Listen to the interview. It's worth the time.