Private equity picks US President

The private equity industry favours Hillary Clinton, a Democrat, as their personal choice for president, while John Kasich, a Republican, is considered the best candidate for the private equity industry, according to sister publication Private Equity International‘s poll conducted mid-April.

When asked who they would personally like to see in the White House, 37 percent voted for Clinton. She was followed by Kasich, who received 28 percent, and Donald Trump (R), who lagged behind at 16 percent. Bernie Sanders (D) came in fourth place with 8 percent and Ted Cruz (R) came in last with just 6 percent.

Of the 129 respondents, 41 percent were GPs, 18 percent were LPs and 41 percent service providers, including consultants, analysts and a CFO. More than half were based in the US, 30 percent were from Europe and the remainder in spread over Canada, Latin America, Africa, Asia and the Middle East.

“[Clinton] will hit the right balance between the interest of the private equity industry and its macroeconomic function as well as the necessity to limit some of its overdoings,” one respondent wrote. Others noted they believed she could bring political stability and sustainable growth and that Clinton is a “friend of private equity at the end of the day.”

Clinton has criticised private equity and hedge fund managers for paying “lower tax rates than nurses or the truckers” and has herself been criticised for accepting paid speaking engagements at private equity events run by the likes of The Carlyle Group and KKR. Her tax plan calls for taxing carried interest as ordinary income at the 39.6 percent rate instead of the current 23.8 percent.

When asked to choose the best candidate for private equity, readers picked Kasich as their favourite, who commanded 30 percent of the vote, followed closely by Clinton with 26 percent. Trump came in third place with 15 percent, followed by Cruz with 11 percent and Sanders with just 3 percent.

Respondents described Kasich as “business oriented,” and pointed to his financial background. “He’s the only candidate who is pragmatic,” said one respondent, adding that “he’s conservative. He has the best practical understanding of global business and finance.”

Kasich, a former investment banker at Lehman Brothers, has said that he would lower the tax on capital gains to 15 percent from 20 percent.

For Sanders, who drew little support from respondents, either on a personal level or for what his presidency could do for the industry, one respondent wrote: “I know I am in the minority in the private equity industry by supporting Sanders, but I believe he’d be best for the country in every way, including economically, which would benefit private equity.”

A Trump supporter wrote of the candidate’s corporate funds repatriation plan to discourage tax inversions: “by allowing those corporations to bring back their funds into the USA, there will be more funds to invest in the industry.”