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Opinion | Private Equity Doesn’t Want You to Read This

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This column has been updated.

This column is about the excesses of the private equity investment industry. It delves into the minutiae of the tax code, corporate structure and certain abstruse practices of financial engineering. There will be jargon: carried interest, leveraged buyout, joint liability. I am aware that none of this is anyone’s favorite thing to be discussing on a summer’s day.

But private equity is counting on your lack of interest; the seeming impenetrability of its practices has been called one of its “superpowers,” among the reasons the trillion-dollar industry keeps getting away with it.

With what? An accelerating, behind-the-scenes desiccation of the American economy. Democrats in the Senate were poised to pass a rule that might slightly clip the industry’s wings — a change to the tax code that would force partners in private equity firms, hedge fund managers and venture capitalists to pay a fairer share of taxes on the money they make.

I can’t fathom what her reluctance might be. One of private equity’s main plays is the leveraged buyout, which involves borrowing huge sums of money to gobble up companies in the hopes of restructuring them and one day selling them for a gain.

But the acquired companies — which range across just about every economic sector, from retailing to food to health care and housing — are often overloaded with debt to the point of unsustainability. They frequently slash jobs and benefits for employees, cut services and hike prices for consumers, and sometimes even endanger lives and undermine the social fabric.

It is a dismal record: Private equity firms presided over many of the largest retailer bankruptcies in the last decade — among them Toys “R” Us, Sears, RadioShack and Payless ShoeSource — resulting in nearly 600,000 lost jobs, according to a 2019 study by several left-leaning economic policy advocates.

Other investigations have shown that when private equity firms buy houses and apartments, rents and evictions soar. When they buy hospitals and doctors’ practices, the cost of care shoots up. When they buy nursing homes, patient mortality rises. When they buy newspapers, reporting on local governments dries up and participation in local elections declines.

It is unclear even if private equity pays off for the investors — like university endowments, public pension funds and wealthy individuals — who put money into the industry in the hopes of outsize returns. Since at least 2006, according to a study by the economist Ludovic Phalippou, the performance of the largest private equity funds has essentially matched returns of comparable publicly traded companies.

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Still, the industry has been growing quickly, and it had a record year in 2021. According to McKinsey, private equity’s total assets under management reached almost $6.3 trillion last year. The American Investment Council, a trade group representing the industry, says that companies backed by private equity firms employ nearly 12 million Americans.

With the help of lax regulation and indefensible tax loopholes, private equity’s apparent destructiveness can be enormously profitable for its partners. Private equity firms make money by extracting hefty fees from their investors and from the companies they purchase, meaning they can succeed even if their investments go kaput. Phalippou found that between 2005 and 2020, the industry produced 19 multibillionaires.

“It’s a heads-I-win, tails-you-lose model,” said Jim Baker, the executive director of a watchdog group called the Private Equity Stakeholder Project.

But it gets worse: Not only do private equity partners make money even if their companies blow up; they also get a pretty good deal from the government on what they earn. Private equity funds generally charge their investors two different fees: a management fee of 2 percent of invested assets per year (funds are held for an average of about six years), and a “carried interest” fee that is 20 percent of any investment gains realized in the fund.

In most other industries, the Internal Revenue Service would categorize a fee like carried interest as ordinary income (like how your salary is taxed) rather than a capital gain (like how your stock market winnings are taxed). After all, the partners are receiving the fee as compensation for performing a service (managing investors’ money), not collecting a gain on their own invested capital (because it’s the investors’ money, not theirs).

But that’s not how it works for partnerships like private equity, hedge funds and venture capital firms. Under I.R.S. guidelines, carried interest is taxed as a capital gain, which has a top rate of 20 percent, rather than as income, which has a top rate of nearly 40 percent. The upshot: Millionaire and billionaire partners in private equity firms pay a far lower tax rate on much of their income than many of the rest of us.

The private equity industry defends its preferential rate by citing “sweat equity” — even if partners don’t put much of their own capital at stake, they are being rewarded for investing their “ideas and energy,” as Steve Klinsky, a former chair of the American Investment Council, put it in a recent article. But it’s difficult to find many beyond the industry who will defend carried interest’s low taxation.

Barack Obama called for the loophole to be eliminated. Donald Trump pledged to eliminate it. So did Joe Biden. Even several financial tycoons have called for its repeal — Jamie Dimon, Bill Ackman and Warren Buffett among them.

Despite widespread opposition, though, the tax break has somehow endured — as Tim Murphy wrote recently in Mother Jones, it has been “the most unkillable bad idea in a town with no shortage of them, a testament to the unstoppable combination of money and inertia.” (Murphy’s piece was part of an excellent, multipart investigation of the private equity industry published by the magazine.)

The Democrats’ proposal would have merely narrowed — but would not have eliminated — the carried interest loophole. Passing it would have been a good start toward reforming the private equity industry.

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Even if it passed, though, much more would need to be done. Eileen Appelbaum, an expert on the private equity industry who is a co-director of the Center for Economic and Policy Research, a liberal think tank, told me she favored many of the ideas in the Stop Wall Street Looting Act, a bill introduced last year by Senator Elizabeth Warren and several other liberal Democrats. The act would impose lots of new rules on the industry, including limiting tax deductions on excessive debt and adding worker protections for when debt binges lead to bankruptcy.

One of the most important ideas, Appelbaum said, is known as joint liability, which would hold private equity firms responsible for the debt incurred by portfolio companies if the companies go belly up.

“It doesn’t tell you how much debt you can put on it,” Appelbaum said. “It just says, ‘whatever debt you put on it, you’re going to be jointly responsible.’”

That struck me as an elegant and sensible idea. If private equity firms claim they should get credit for their “sweat equity,” why shouldn’t they be held responsible when the sweat turns to tears?

Farhad wants to chat with readers on the phone. If you’re interested in talking to a New York Times columnist about anything that’s on your mind, please fill out this form. Farhad will select a few readers to call.

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A journalist since 1994, he also founded DMGlobal Marketing & Public Relations. Glover has an extensive list of clients including corporations, non-profits, government agencies, politics, business owners, PR firms, and attorneys.

Africa/Caribbean

South Africa, Sanctions, and the Politics of Global Punishment

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(WASHINGTON, DC – July 25, 2025) – Once again, the spotlight turns to South Africa — not for its triumphs or tragedies, but because the U.S. House Foreign Affairs Committee has advanced a bill aimed at penalizing our ally. The language, timing, and underlying motivations behind this legislation are telling. The question isn’t just why now — it’s why at all, and who really suffers?

Let’s be clear: this bill, like many others introduced in the name of democracy or national security, walks a thin line between accountability and imperial overreach. The stated aim is to target corruption within the ANC, not the country. But history tells us that when global superpowers impose sanctions — even those aimed at individuals — the economic and reputational collateral damage is often borne by everyday people.

Ask any South African struggling with load-shedding, unemployment, or inflation if they feel insulated from the ripple effects of diplomatic decisions. They don’t. Sanctions, no matter how “targeted,” rarely stay in their lane.

There’s an uncomfortable arrogance in the notion that the U.S., particularly under figures like Donald Trump, can strong-arm sovereign nations into submission. South Africa has made decisions that reflect its values — whether it’s supporting Palestine at the International Court of Justice or choosing not to blindly follow Western foreign policy scripts. For that, it now risks punishment cloaked as policy.

But what’s most striking is the conversation on the ground. South Africans aren’t monolithic in their reactions. Yes, there’s anger at ANC corruption — and rightfully so. But there’s also sharp resistance to the idea that the U.S. gets to play global sheriff. Many see this as yet another example of Global South nations being disciplined for daring to think independently.

And in that pushback, there is power. We’re seeing the rise of leaders across Africa — from Burkina Faso to Uganda — rejecting old power structures and demanding a new, multipolar world. One not dictated by Washington or Brussels, but shaped by local priorities, African agency, and global respect.

As a media outlet rooted in Black empowerment, BlackUSA.News has always stood for truth and sovereignty. The U.S. cannot lecture the world on corruption without looking inward. And it certainly cannot claim moral authority while threatening allies who don’t toe the political line.

This bill may not pass. It may just be symbolic noise. But it sends a message. And the message received, from Cape Town to Baltimore, is clear: Black nations must be obedient, or be punished.

We’ve seen this before. But history also shows us something else: we rise.

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Africa/Caribbean

From Baltimore to the Sahel: A Prayer for Ibrahim

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(BALTIMORE – July 25, 2025) – The Sahel is the ecoclimatic and biogeographic zone of transition between the Sahara Desert to the north and the Sudan savanna to the south. It stretches across Africa — from Senegal and Mauritania in the west to Sudan and Eritrea in the east. It’s a massive band of land that touches multiple nations and countless lives.

The name Sahel comes from the Arabic word for “shore” — a poetic image, really. The Sahel is the shoreline of the desert, where sands meet soil, where barrenness kisses life. It is dry, hot, and plagued by drought and insecurity. It is also rich — not just in natural resources, but in culture, history, and resistance.

Some people may read this and scroll on by.
That’s fine. I’m not writing for approval.

I’m writing for those of us who know we are part of something bigger than ourselves.
Those of us who know that Black liberation is global.

Let me be clear: There is a Pan-African revolution quietly happening, and most of us in the West don’t even see it. Maybe we’re too distracted. Or maybe we’re too misinformed. But we’re missing one of the biggest geopolitical shifts in our time.

Across the Sahel — in Burkina Faso, Mali, and Niger — African people are saying NO MORE to foreign control.

They’re kicking France out.
They’re closing military bases.
They’re rejecting the CFA franc.
They’re uniting under the banner of true African sovereignty.

Meanwhile, here in the U.S., many of us are busy chasing the next viral trend or worrying about the latest political scandal. And while we must handle our business locally, we can’t afford to be blind to the movement globally.

Because it’s all connected.

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One man I want you to know is Captain Ibrahim Traoré, the 36-year-old interim president of Burkina Faso.
This brother has done what few African leaders have dared to do:

  • Expel foreign troops.

  • Call out French neocolonialism.

  • Demand African unity without Western strings.

He speaks with the clarity of someone who’s had enough. And he acts with the courage of someone who knows that change will cost him something — maybe even everything.

They’ve tried to kill him — multiple times.
He’s surrounded by threats — internal and external.
And yet, he continues to move with faith and focus.

I don’t just admire him.
I join countless others who pray for him.
We pray for his protection, for his clarity, and for his legacy.

You see, what Traoré is doing isn’t just political.
It’s spiritual.

He is challenging centuries of domination.
He is leading a people to believe again in themselves.
He is building a new future — not just for Burkina Faso, but for Africa, and yes, for the entire Diaspora.

Let me say this plainly:
We cannot afford to be culturally or politically illiterate about the Sahel.
The same colonial forces that broke up our families during the Transatlantic Slave Trade…
The same economic systems that redline our neighborhoods in Baltimore, Chicago, and Detroit…
Are the same ones exploiting gold mines and uranium fields in West Africa right now.

It’s all one struggle.
And we need one consciousness to face it.

You might ask, “What can I do from over here?”
Start with this:

  • Learn what’s happening.

  • Speak on it when others are silent.

  • Pray for leaders like Traoré who are on the front lines.

  • Support Black institutions here and abroad.

  • Reject the propaganda that tells you Africans are helpless and hopeless.

Because they’re not.
They’re rising.

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The people of the Sahel are writing a new story.
And we need to pay attention — not as outsiders, but as family.

This is bigger than news. It’s bigger than politics.
It’s about reclaiming our collective future.

As I prepare to release my upcoming book, “Black Blueprint: From Baltimore to Burkina Faso”, I realize more than ever that the Black fight for freedom cannot be confined to borders.
What we do here affects what happens there — and vice versa.

So I ask you to pause. Reflect.
Selah, as the scriptures say.

Selah, Sahel.
Let us not miss this moment.
Let us wake up — and walk in unity, with wisdom and purpose.

Because if we don’t…
We’ll keep mistaking oppression for order.
And we’ll keep confusing silence for peace.

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Business

Black Women in Business: A Celebration of Tenacity, Triumph, and Transformation

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Photo: Veteran journalist and publisher Cheryl Smith has been a powerful voice in Black media for over four decades. A Florida A&M alum, Smith is founder of I Messenger Enterprises, publisher of Texas Metro News, Garland Journal, and I Messenger. From The Dallas Weekly to KKDA-AM, she’s shaped news, mentored youth, and championed community causes. A trailblazer, educator, and award-winning leader, Smith continues to uplift voices and inspire change in North Texas and beyond.

(WASHINGTON, DC – July 24, 2025) – Across boardrooms, storefronts, and startup spaces nationwide, Black women are rewriting the story of American entrepreneurship. They are not just participating—they are leading. With nearly 2.7 million Black women-owned businesses across the United States, generating over $60 billion in annual revenue, these trailblazers are pushing past obstacles and creating new paths of possibility.

At BlackUSA.News, we celebrate these women not only for their bold business ventures, but for the powerful statement they make every single day: We will not be denied.

The Fastest Growing Force in Business

From 2014 to 2019, the number of businesses owned by Black women grew by 50%—the highest growth rate of any female demographic. Black women now make up 42% of all new women-owned businesses and represent 36% of all Black employers. This is no small feat; it is a revolution.

This surge is more than a trend—it’s a testament to vision, resilience, and grit. Whether launching a beauty brand, building a tech company, founding a nonprofit, or running a food truck, Black women are stepping into their power and redefining success on their own terms.

Courage in the Face of Challenges

The road to entrepreneurship is rarely smooth—and for Black women, the path is often filled with barriers that others never encounter. Discriminatory lending practices, lack of access to venture capital, and systemic economic inequalities persist. Nearly two-thirds of Black women entrepreneurs self-fund their businesses, despite having less generational wealth or household income compared to their white counterparts.

And yet—they rise.

Even as fewer than 3% of Black women-owned businesses reach the five-year mark, this community of innovators continues to build, to dream, and to rise above the statistics. They juggle caregiving, full-time jobs, and community commitments—often working double-time just to stay in the game.

Their businesses may be born out of necessity, but they are driven by purpose. And that purpose is reshaping industries and communities.

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The Legacy Continues

From the legacy of Madam C.J. Walker, the first self-made Black woman millionaire, to modern moguls like Oprah Winfrey, Janice Bryant Howroyd, Cathy Hughes, and Beyoncé Knowles-Carter, Black women have long shown what’s possible when brilliance meets opportunity.

And today, new names are being etched into that legacy. Names like Rosalind Brewer, CEO of Walgreens Boots Alliance. Sheena Allen, fintech founder. Melissa Butler, creator of The Lip Bar. Pinky Cole, founder of Slutty Vegan. The list grows by the day—and every name represents a story of perseverance and power.

A Call to Action

It’s not enough to applaud Black women from the sidelines—we must invest in them, mentor them, partner with them, and amplify their work. The financial community, government agencies, and private institutions all have a role to play in eliminating structural inequities and providing real access to capital, networks, and growth opportunities.

As JPMorgan Chase’s Tosh Ernest puts it: “Black women are positioned to play an increasingly visible and important role in the United States’ future like never before.”

We at BlackUSA.News believe that future is already here. It’s being built every day by women who defy the odds, uplift their communities, and turn vision into value. They are not just surviving—they are thriving. And we’re proud to tell their stories.

In Their Honor

To every Black woman entrepreneur grinding before dawn, balancing motherhood with market research, transforming a side hustle into a legacy—we see you. We salute you. We celebrate you.

Because when Black women rise, we all rise.


🖤 For more stories like this, visit www.BlackUSA.News —where Black voices lead the narrative.

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