Multi-billionaire Stephen A. Schwarzman says he’s puzzled by the amount of discontent apparently felt by other Americans these days.
Steve Schwarzman is a bland-looking, somewhat paunchy, not unattractive, balding man of benign demeanor who will be 69 on Valentine’s Day 2016. He’s worth $12 billion, give or take a few hundred million. He is a poster boy for Wall Street success and self-esteem and cluelessness. He’s the co-founder, chairman, and CEO of the Blackstone Group, one of the world’s largest financial firms, specializing in private equity, hedge funds, and mergers. He’s a Republican, and his life has been going pretty well for him lately, as it has for decades.
But he freely admits (or pretends to admit) that he doesn’t understand why the rest of America isn’t just as content as he is. On January 21, at the World Economic Forum in Davos, Switzerland, Schwarzman spoke to a gathering of his peers who run the world about his perception of the US presidential election campaign:
“I find the whole thing astonishing and what’s remarkable is the amount of anger whether it’s on the Republican side or the Democratic side…. Bernie Sanders, to me, is almost more stunning than some of what’s going on in the Republican side. How is that happening, why is that happening?”
One clue to “why is that happening,” a clue Schwarzman presumably noticed last October, wasthe $39 million fine Schwarzman’s Blackstone Group advisors had to pay for bilking customers. Blackstone entered into a “consent agreement” with the US Securities and Exchange Commission (SEC) finding that “it breached its fiduciary duty” to its customers. The consent agreement, admitting no guilt, is a tactic often used by corporate shysters to cut their losses when caught with their hands in other people’s pockets. Blackstone’s “cooperation” with the SEC was cited as a reason the SEC fined the company only $10 million. Or, as the SEC press release put it:
“Blackstone consented to the entry of the SEC’s order…. Without admitting or denying the findings, Blackstone agreed to cease and desist from further violations, to disgorge $26.2 million of ill-gotten gains plus prejudgment interest of $2.6 million, and to pay a $10 million civil penalty…. The settlement reflects Blackstone’s remedial acts and its voluntary and prompt cooperation with the Division of Enforcement’s investigation.” [Note: with revenue of $7.484 billion, Blackstone’s $10 million fine represents 10/7484th – or .1336% – of its income.]