Private Equity, The Enemy from Within…. Part Two…

Private Equity, The Enemy from Within…. Part Two… 

 

And this year’s Neoliberal Darwin Award Winner

 

In addition to finding lower wages in monopsony markets, the researchers also found that, over time, firms that dominate their labor markets were less likely to share productivity gains with employees. A one standard deviation decline in the HHI mapped to an increase in the elasticity of wages with respect to productivity of about 25 percent, from 0.38 to 0.47.

 

The only employees who did not experience wage stagnation in markets with high plant concentration were those who belonged to unions. 

-             Employer Concentration and Stagnant Wages, NBER

 

 

By Gregg Wall (11-22-2026)

 

Two weeks ago, JMH did a dive into private equity from a micro perspective and recent developments within the industry and financialization… this week, we cover financialization from a macro perspective: the role the corporate MSM plays in propping up the failed dereg and neoliberal paradigm that allows financialization to thrive; the catastrophe that is financialization & private equity and why both are so damaging to the economy and ruinous to people’s lives; and financialization not only destroys the economy but leads nation-states to war spending, wars, and fascism.

 

More lies from the Bank of Canada?  This week, the BOC said the keys to prosperity, fighting inflation, and raising everyone’s income was to increase growth & productivity.  The corporate MSM dutifully repeated the lie without question or pushback… the MSM consistently fails to pushback on elite narratives and has little to say about the West’s complete lack of willingness to acknowledge and address the failures surrounding deregulation, financialization, and libertarian dogma.  See massive food insecurity and poverty throughout North America.

 

The BOC & MSM, of course, leaves out, much as Mr. Carney has, that inflation in North America is greed driven, monopoly & cartel driven, private equity driven… that is to say, supply-side driven.  Inflation sure as hell is not demand driven… judging from bankruptcies and skyrocketing credit card debt, and debt the public is accumulating placing groceries on credit cards & payday loans.  No amount of increased productivity or tax rebates will bring down greed driven, supply-side driven inflation, as the robber barons will merely pocket productivity gains w/out passing on the savings to the consumer… that’s the power of financial engineering, that’s the power of M&A, authoritarian cartel, and totalitarian monopoly.   

 

The BOC & MSM also conveniently miss out on the fact that Canada and the US have enjoyed both growth and productivity gains for decades and North Americans have never been more poor & the most privileged more wealthy.  Moreover, the entire dereg, libertarian, and financialization paradigm… along with corrupt crony government… has never been more rotted out entirely.  And the corrupt, corporate MSM, per the usual, fails and entirely misses both the point and story entirely.   Gee, who owns the corporate MSM?  Well, that’d be billionaires, and they have zero interest in investigative reporting and poking holes in a rigged economy and government that have made them catastrophically wealthy.   

 

Before we depart the BOC & MSM, there’s one more point and it is this… given the increased dominance of financial engineering, private equity (remember the 19,000 PE funds from my last piece), and venture capital within the economy, and the destruction of economy & opportunity that comes with financialization & financial engineering… how does one go about measuring productivity?  It’s quite a conundrum.  How to measure productivity in an economy increasingly based upon: Financialization… greed, rent seeking behavior, private equity looting & theft, crony deal making in the halls of government, failed privatization scams, the transfer of wages, wealth, and government largesse to greedy billionaires & multimillionaires (while robbing public services blind)… how precisely, to measure productivity of bankers shuffling papers and computer transactions on the latest junk debt or M&A deal?  How does one measure productivity on real estate speculation, digging cancer & tar sands out of the ground in Fort McMurray (especially when Alberta O&G is a net liability)?  Or productivity and growth from corrupt politicians in Ottawa and Edmonton, who fail Canadians and Alberta, hourly, daily, annually.  And given that financialization is a net drag on the economy and kills jobs, should we discount any so-called growth from private equity, venture capital, and financial engineering?

 

So, there’s the propaganda element to all this, and the role billionaire owned and operated corporate media plays in ensuring that the sacred cow of our failed libertarian economy and financialization are never questioned or BBQed.  But there’s the financial engineering model itself, which is completely damaging and destructive to the economy, government, and as we shall write about shortly, world peace. 

 

In the early days of private equity and venture capital, it probably didn’t matter a great deal, at the macro level, that a few workers lost their jobs or suffered suppressed wages, lost benefits to pay for private equity executive pay or leveraged debt.  However, when a huge segment of the economy faces 19,000 private equity funds, the offshoring of labor, the suppression of wages, M&A, monopoly formation, predatory cartels, and software & AI engineered to extract rents, higher prices, & profits from the public, it destroys discretionary spending.  Workers are so distraught and distressed that they have to put essential spending and necessities on credit cards or go without, which leaves no money for mom-and-pop businesses and other enterprises & spending deemed discretionary, which absolutely kills animal spirits, entrepreneurship, growth, and zombie enterprise.  Which might explain record bankruptcies, sky-high credit card debt, and workers delaying retirement or planning to work in perpetuity.  

 

There’s more, increasingly private equity is diversifying into private credit: payday lending, private credit, online lending with sky high lending rates, terms, conditions, and fees.  Coupled with PE’s growth in residential property and apartments, as well as, PE’s growth into utilities, and it all leads up to rent seeking behavior.  No job creation, no opportunity, no growth in the real economy that the BOC was talking about: just predatory greed.   So that workers are increasingly faced with low wages, if they are lucky enough to have an income, but also parasitic billing and rents taking wages that have not kept up with inflation.  Of course, we haven’t discussed private equity’s move into healthcare, which, within the US in particular, is as, if not more, destructive to the fiscal health of the nation, the US gov, and family budgets.

 

There are so many ways financial engineering… which again, isn’t limited to private equity operations, but is in fact ubiquitous throughout the real economy … is so damaging.  The way publicly traded companies mercilessly prey upon the public, clients, consumers, and labor, one really has to conclude that the core business itself, such as the airlines or even healthcare insurance… is nothing but a sideshow, a vehicle for executives and owners to conduct financial engineering (with the real action taking place in stock manipulation, stock buybacks, mergers, financed dividends, etc.).  A financialized, consolidated, monopoly economy permits this.  Financialization’s lock on government, the two political parties, the day trading in the halls of congress… Wall St’s own rent seeking behavior, its collection on rents and private taxation on core, fundamental commodities, such as oil & gas, are yet more examples of financialization’s damaging effects (e.g. see the price on a barrel of oil plummeting and yet retail prices remain sticky, that is seemingly incapable of falling).  Financialization reaches beyond the private sector and has its tentacles wrapped tightly around local, state, and federal governments… as previously mentioned so as to become, Too Big to Fail and Too Big to Be Questioned & Subpoenaed.  PE and VC throttle the integrity of democracy and the American government, by design.  And it’s not enough for financialization, oligarchy, and Wall St to dominate the courts, the executive & legislative branches, because via crypto, Silicon Valley oligarchs and venture capitalists **appear** to ultimately have their sights set on dominating currency and monetary policy (which, if achieved, will give them fantastic sums of revenue and incredible economic power).  All of this is to say, a functioning democracy and government is bad for Wall Street and Corporate America’s business model.  They like their workers prostrate, destitute, and dependent upon a nonliving wage with few options and preferably little or no safety net.  Financialization is everywhere and allowed to run rampant at the expense of the economy, families, labor, the fiscal health of the nation, and the monetary health of nation-state currency.

 

 

 

 

 

 

 

 

Lastly, financialization and private equity are killers… and lies at the beating, cancerous heart of the necro-economy.  As mentioned in the last write up, PE’s long-standing investments and ties to war contractors and the state, along with its recent moves into financing the Department of War, demonstrates a desire not only to become TBTF but a protected business model & asset under the umbrella of national security.  This, while profiting immensely from America’s insatiable appetite for colonialism, debt slavery, exploitation of labor, global south subjugation, necro-politics (the commodification of human existence), privatization of resources in public lands, and endless for-profit wars… with the Department of War serving as both the oligarchy’s and Wall St’ enforcement arm, global protector of capital, and a profit center.

 

Financialization & private equity’s role in the necro-economy & politics, and thereby societal engineering, demonstrates this industry and Wall St, generally, plays a key role in fascism and the spread of militarism, itself.   Not only by backing far-right judges and politicians but through the control and funding of far-right influencers, MSM, podcasters, and social media personalities.  Financial engineering’s business model and the necro economy  manufactures deprivation, desperation, greedflation, joblessness, poverty, scarcity, and underemployment.  Coupled with the mantra that if you aren’t making it and participating in the American dream – it's your fault, many of the unemployed and those faring poorly economically will look to scapegoat disenfranchised groups, immigrants, minorities, women as the reason for their problems… and furthermore, embrace authoritarians and far-right ideology as the answer to their problems and provide a sense of belonging & identity to like-minded individuals.  Generations conditioned by family, white supremacy narratives, and within socio-economic groups also come into play.

 

The failed dereg, libertarian, financialized economy actually breeds fascism, jingoism, and militarism.  It’s in the oligarchy’s and Wall Street’s interests.  Sky-high unemployment & underemployment -- as a result of financialization, cuts to labor to service catastrophic debt loads, industry consolidation, & the offshoring of jobs -- will often make desperate workers seek out military jobs and free healthcare comes with that package.

 

Desperate elites dump money into an unaudited DOW/MIC, because they can portray the economy as growing (ironically, via debt, deficits, socialism, and war) … at the same time, the contractionary forces of debt, financializaton, greed, hoarding, oligarchy, and wage & wealth inequality (all features & outcomes of financialization) restrict growth and opportunity.   Of course, billionaires make obscene profits from the command & necro economy’s greatest endeavor: WAR.  Of course, with all that spending on military and war, America must have an enemy, which is where fascism, the MSM propaganda machine, manufactured fear, societal manipulation, and white supremacy comes in. 

 

None of this is an attack on socialism, I’m merely pointing out the shear hypocrisy of a predatory elite that defends libertarianism and rugged individualism, while being creatures of the state and making a fortune off socialism for the 1%… I’m merely pointing out how much better off Americans would be, if that fraud & waste within the Department of War and Empire was instead, allocated to ensuring affordable housing, Medicare for All, and well-paying jobs? 

 

Notice, all this debt and deficits (shoveled into the war machine) … and money printing by the FED... feeds the financialized economy; feeds rising asset valuations for the uber rich; feeds greed, oligarchy, wealth inequality, and private equity & venture capital in one continuous doom loop of economic, planetary, and societal violence.

 

At the end of the day, Wall St., obscene greed, private equity, venture capital, speculation in commodities, derivatives & swaps (used to gamble) w/out proper collateral (reinsured by the taxpayer), financialization & financial engineering… M&A and industry consolidation… are a huge problem for the US & the world.  They add nothing of value.  In fact, the entire industry is a job killer, an economy killer, murders society… doubt me, see soaring nation-state debt to prop up the house of cards.  In short, financialization, greed, hoarding, engineered monopolies, oligarchy, and private equity are a gross misallocation of resources.

 

Wall St and financialization’s profits come from wage & wealth transfer, mercenary greed, looting & theft, unaccountable private sector taxation… even the investment returns for pensions & 401Ks are blood money, coming at obscene costs (essentially robbing current and future generations).  That’s why Financialization and Private Equity are this year’s Darwin Award Winners.  Wall St. is lethal.   What did Goldman Sach’s CEO say during the ’08 crisis, Wall St is just doing the devil’s work?

 

There’s so much more that could be written about this topic and a much deeper dive is in order.  Alas, corporate media doesn’t get paid to protect the public, enlighten, educate, inform, and expose financial engineering and private equity… it gets paid, for the most part, to protect the system, despite the system’s obvious breakdown, decay, failure, and oceans of human misery, poverty, and suffering financialization leaves in its wake.  Any critical write ups & deep dives on financialization and financial engineering are often taken on by independent media and don’t receive the coverage, exposure, & saturation they so richly deserve.  A well-informed public is dangerous to a failed financialized status quo and particularly to this year’s Neoliberal Darwin Award winners: financialization and private equity. 

 

 Copyright JM Hamilton Publishing 2025