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Huh: Schumer Not Keen on Increasing Taxes For Hedge Funds, Private Equity Firms
By
Jen Chung
Published Jul 30, 2007
Modified Mar 7, 2008
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By
Jen Chung
Published Jul 30, 2007
Modified Mar 7, 2008
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You may have many opinions of Senator Charles Schumer. A man who gives weekly press conferences by way of making the rounds on Sunday morning news shows, someone who will "put a bullet betweens the president's eyes," the senior Senator of New York, orchestrator of the Senate's shift back to the Democrats, husband of a recent Department of Transportation commissioner, imaginer of middle class couple the Baileys, cereal hog. But defender of hedge funds' and private equity firms' desire to keep their low tax rate? Who knew?
The NY Times has a fascinating article on how Schumer is resisting "an effort led by members of his own party to single out the industry with a plan that would more than double the taxes on the enormous profits reaped by its executives." Yes, Schumer has been pro-business and supportive of Wall Street, but he's also positioned himself as a champion of the middle class. Or at least someone who wants their votes for the Democratic Party, given his book, Positively American: Winning Back the Middle Class One Family at a Time. Hell, the book's author is "Senator Chuck Schumer" - an attempt to relate to the every Joe or Jane. Yet:
Mr. Schumer has said he agrees with the general notion that Congress needs to raise more money for vital initiatives, and that the nation’s wealthiest should bear much of that burden. “I am not a populist, but I am a pro-government-type person who believes the government needs some revenues, and the only logical place to get it is from the very top end income-wise,” he said in the interview.
But in his conversations with Wall Street executives about the tax proposals, Mr. Schumer said, he has told them that he would oppose a tax increase as long as it did not also apply to other industries, like energy and real estate.
Schumer says that he's worried that hedge funds and private equity firms would leave NYC, NY State or the country if their taxes were increased from 15% up to 35%. But Representative Charles Rangel, a co-sponsor of the tax increase, said, "If the businesses are so fragile that taxing them at an equitable rate will cause them to leave the city, I can’t picture that."
Some say that the hefty contributions Schumer gets for the Democratic Party from hedge funds and private equity may have spurred this kind of thinking, but Schumer denies it. So far, Democrats who approve of the tax increase include the junior Senator from NY Hillary Clinton, Senator Barack Obama, former senator John Edwards, and former secretary of the treasury Robert Rubin.
Photograph of Schumer with Starrett City residents back in February by Kathy Willens/AP
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Jen Chung
Jen Chung is a former WNYC and Gothamist editor.
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