Schwarzman s original beef with Obama grew out of a 2008 campaign promise that "carried interest"- the compensation structure of private-equity-fund managers - would be taxed as ordinary income (35 percent) instead of capital gains (15 percent). Obama and many Democrats have argued that it s unfair for people like Schwarzman, with a net worth of about $8 billion, to pay taxes at a lower rate than their secretaries and chauffeurs. More substantively, the commissions and fees that hedge-fund managers reap (20 percent of their clients profits) are not, strictly speaking, capital gains because the managers themselves never held the stocks.
It should hardly be a surprise that the business community is feeling a bit put upon these days. After all, it is coming off a glorious decade in which business lobbyists not only set the agenda for the White House and Congress but also headed many of the economic agencies and drafted the most important legislation and regulations. It is only now that the rest of us are having to clean up the mess left behind by this anti-tax and anti-regulatory orgy -- the enormous trade and budget deficits, the financial crisis, the environmental disasters, runaway health spending, and the widening gap between the rich and everyone else.