What was Damien Lewis, Homeland star and a veteran British Shakespearean actor, thinking when he signed on to the almost-good-but-ultimately-depressing Showtime series Billions? The show never fails to disappoint despite Paul Giamatti's spirited renderings of Iago-like dialogue and the compulsively watchable Alpha Grrl Maggie Siff.
Co-created by Andrew Ross Sorkin, the New York Times finance writer who launched the paper's Dealbook section, the show has one redeeming value apart from the scenery-chewing: it's an insider's look at the nefarious doings of hedge fund pirates. A recurring minor theme is Bobby Axelrod, the hedge fund titan played by Lewis, attempting to convince pension fund managers to bend the rules when his firm is in a cash-flow crunch.
He'll have an easier time now, thanks to the Trump administration's Labor Secretary Eugene Scalia, the son of late Supreme Court Justice Antonin Scalia, and, prior to his ascension to Trump's cabinet, a lawyer working for Wall Street banks, including the high priests of finance at Goldman, Sachs.
On June 3, the Trump administration changed the enforcement of federal law protecting workers' retirement savings. A bit of paperwork called an "information letter" from the Employee Benefits Security Administration gave what is called "guidance" to the Switzerland-based hedge fund Partners Group that allowed corporations to funnel worker 401k plans to high-risk private firms known for their notoriously high fees.
Steve Schwartzman, the billionaire CEO of Blackstone, the world's largest private equity firm and a longtime Trump supporter, had been pushing for the change. He has already funneled $3 million into a super PAC backing Trump's re-election bid.
Schwartzman, the former CEO of Lehman Brothers, which went belly-up in the 2008 housing crisis, has a fortune estimated at $17.2 billion. His father, a Wharton School of Business graduate, ran a dry goods store, and Schwartzman's business career began in Tom Sawyer fashion, operating as a salesman while employing his twin brothers to do the actual work.
Schwarzman seems to have a rather narrow field of vision. In August 2010, Schwarzman compared the Obama administration's plan to raise the tax rate on carried interest to Hitler's invasion of Poland. His daughter, Zibby Owens, is a writer who has used her podcast "Moms Don't Have Time to Read" to become an "influencer," helping launch the careers of her chosen writers from her $37 million apartment. Like Ivanka Trump, she has never publicly criticized her father, or, to anyone's knowledge, refused to take his money.
The Intercept recently reported that Blackstone is a major investor in a controversial port and highway in Brazil that has turbocharged rainforest destruction favored by Brazil's strongman president, Jair Bolsanaro.
Schwarzman and his wife Christine at Oxford in 2019 after donating $150 million, the largest gift in the university's history. The gift helped make up for reduced government funding, thanks to a "business" approach adopted by Britain in recent years . No irony intended.
“This information letter will help Americans saving for retirement gain access to alternative investments that often provide strong returns,” Labor Secretary Eugene Scalia was quoted as saying in a statement announcing the new policy. “The letter helps level the playing field for ordinary investors and is another step by the department to ensure that ordinary people investing for retirement have the opportunities they need for a secure retirement.”
Secure? Well, maybe. Hedge funds haven't been doing so well since the pandemic. Several of Blackstone's funds have been hit hard in the first quarter. In fact, hedge funds aren't such a great investment even under normal circumstances. From January 1994 to October 2018, the S&P index outperformed every major hedge fund by 2.25 percent. Now private equity firms will be allowed to manage — and charge fees for — the $9 trillion in 100 million workers’ 401k plans and IRAs.
“If just 5 percent of the money in these retirement funds were available to private equity, it would be a windfall of $435 billion — real money even to private equity millionaires and billionaires,” according to Eileen Appelbaum of the Center for Economic and Policy Research.
Trump's hedge fund bailout hasn't been covered by most media. It's not as easy to understand as, say, Ben Carson's $31,000 office furniture, but it's a hell of a lot more important, with potentially disastrous consequences, especially for older Americans.
Former LBJ speechwriter and longtime PBS host Bill Moyers' media operation has been covering Schwartzman for the past decade. Investigative reporter Aaron Glantz wrote about Schwarzman, who bought what was at the time, the most expensive apartment in Manhattan history, a 34-room penthouse at 740 Park Avenue, where one of his neighbors was Treasury Secretary Steve Mnuchin. Mnuchin, like Blackstone and Trump's buddy Tom Barrack, stockpiled fortunes in the foreclosure crisis of 2008, as Glantz documented in his book Homewreckers.
Like Glantz, the Moyers team is looking beneath the headlines, putting their heads together with think tank wonks who do the righteous work of government watchdogs.
As for Damien Lewis, my guess is that the British aristo couldn't resist the chance to play a hard-charging American roughneck from Yonkers.
And now the actor, like as many as 100 million Americans, is stuck with those jerks.
The Editors