OPERATE INTERNATIONALLY, and at times you have to fight a two-front war. That’s what the private equity industry, with bases both in New York and London, finds itself called upon to do, as politicians in the United Stated and the United Kingdom launch simultaneous attacks on its tax status. Never mind that the deal makers, led as if by an invisible hand, have been contributing to the solution created for market capitalism by the separation of the ownership and control of both nations’ corporations.
That separation is one factor leading to the current battle. For the battle between the politicians and the private equity industry didn’t suddenly flare up because a British deal-maker commented that he pays taxes at a lower rate than his cleaning lady, or because an American equivalent threw himself a birthday ball costing $2 million, or $5 million, or $15 million, depending on your tabloid of choice.
