Private equity lures Washington heavyweights with huge paydays after government stint- report
In the 2012 presidential campaign, the private equity industry was put to the test when Mitt Romney's connection to Bain Capital was used by Democrats to accuse the Republican candidate as a callous capitalist. However, a report on the website Politico said the controversy has not prevented the industry-Democrats included-from courting big names in Washington with substantial offers after their stint in government.
Politico reported that the most recent hires included Sen. Joe Lieberman (I-Conn) who now serves in an advisory role to Chicago-based Victory Park Capital and former Federal Communications Commission Chairman Julius Genachowski who is now part of Carlyle Group. Meanwhile, former Treasury Secretary Timothy Geithner will begin serving as President of Warburg Pincus this March.
Despite the beating the industry took in 2012, last year's hiring spree apparently showed that the mutual attraction still stays strong between private equity and Washington officials. The arrangement enables private equity companies to bolster their standing by hiring Washington heavyweights and previous government officials can get lucrative careers in the private sector in exchange for their skills which were bred and honed at their time in office.
Former Senator Evan Bayh (D-Ind.) told Politico, "The Romney thing - did that cause some temporary publicity to be focused on the industry, given the nature of some of the ads and rhetoric? Was it noticed? Sure. But I think that's largely subsided." In 2011, Bayh joined private equity firm Apollo Global Management.
In the past year, the other Washington insiders that have hopped on board private equity firms include former CIA Director Petraeus who is now with KKR's Global Institute, designer of Obamacare Nancy-Ann DeParle who is with Consonance Capital Partners and former Supplied Allied Commander of NATO in Europe and retired Army General Wes Clark who is now with Blackstone, the report said.