Objectively intelligent.

[Tyrone Slothrop]

Originally Posted by sebastian_dangerfield

PE consolidates. That means, yes, the owner gets to survive. Many of the workers do not. I think AOC and Warren actually trying to protect small business workforces more than small businesses themselves.

I'd hobble PE differently. I might prevent them from doing rollups by creating a reverse windfall tax. Pass a tax treating the discount at which the PE firm is acquiring the small business versus the value of the small business (defined as average yearly revenue of business for past five years X 3) just prior to the Covid crisis (March 20, 2020) as income to the firm, taxed at 20-80%, progressively increasing with size of discount. This would force the PE firm to pay enhanced value to owner.

Couple that with a tax credit to PE for every employee the PE firm retains on the books of any purchased company for 3 years following purchase.

They're not trying to hobble PE, I don't think, nor should they. Fundamentally, aren't they worried that large enterprises will be better capitalized and better able to borrow and so will endure this recession better than small businesses will. That doesn't seem wrong, as a description of what's likely to happen. But blocking acquisitions above a certain size just makes things worse for the struggling targets -- it doesn't give them better access to capital. If you want to solve that problem, the government needs to think much bigger about how to give smaller businesses capital.