Wednesday 18 September 2019

Blackstone boss says teachers shouldn't pay tax in US shake-up

Blackstone CEO Stephen Schwarzman. Photo: Bloomberg
Blackstone CEO Stephen Schwarzman. Photo: Bloomberg
Donal O'Donovan

Donal O'Donovan

The billionaire head of Blackstone says he wants a radical plan to revive America's middle class, including eliminating taxes for teachers, to improve education, lifting the minimum wage and backing technical innovation.

The proposed 'Marshall Plan' for the middle class is a dramatic change of tack for famously hard-nosed private equity titan Steve Schwarzman - who in 2010 was quoted saying his firm was looking at Europe but holding off buying until sellers were in real financial distress. "You want to wait until there's really blood in the streets."

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In Ireland, Blackstone is best known for swooping in during the financial crisis and buying billions of euro in assets at knock down prices, which at one stage included 25pc of Eir, the Burlington hotel and over €1bn of property loans originally linked to developer Michael O'Flynn. It has already successfully exited the bulk of its Irish deals.

Yesterday however, Mr Schwarzman joined a growing number of US business tycoons airing public concerns about income inequality in America. "What we have is less an issue of income inequality than income insufficiency for the bottom 50pc of the society," he told broadcaster CNBC.

He was interviewed after Blackstone Group, the world's largest manager of alternative assets such as private equity and real estate, said on it would convert from a partnership to a corporation, in a bid to get more investors into its stock.

Blackstone is hoping the move on July 1 will boost its share price, which trades at a discount to traditional asset managers such as BlackRock.

A traditionally higher tax burden for corporations has become less severe under President Trump's tax changes.

Irish Independent

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