Yes, We Have Pro-Bad Business Nuts Too!!!

In the african community we are starting to get involved in the investment game, as well as planning for retirement better. The game was often times stack against us. However, I have notice lately, which has now been written about in the TheHill.com, that alot of blacks becoming involved in the investment fund industry are siding with the Republican/Blue Dog Democrat way of thinking about business and picking up the worst habits, namely, make as much money as you can, and simply move it from account to account. No trickle down there.

And Bob Johnson, founder of BET, is exhibiting this "business" ailment.
At one time I actually viewed Mr. Johnson with admiration, being in the very small club of african american founders/owners of multi-billion dollar corporation. The content on BET was even balanced at that time. You still had your 'booty-shake' music, but you also had shows that played Club music, R&B, Soul, and Jazz. You had news shows and documentaries. You even at one time had a youth show that talked about HIV, single parenthood, starting a business, rape, education, etc. Now, most of that has been replaced with 'booty-shake' music half of the day, and the other half is reruns of 227, Amen, and Thea. And while I like those shows........No. Not happenin'. They even cut down on the number of good commentaries/documentaries in exchange for shows like Hot Ghetto Mess (whos name has been change; but not the content). The news shows are gone. And some of this started before Johnson sold the BET, so he can't blame Viacom management. I saw a downward progression to the ditch. And Johnson would, every now and then, defend this.

So now that Johnson has been "freed", he has started 2 investment funds. And he's falling for this meme of if you raise the tax on private-equity funds you'll stunt minority participation in the markets. But the truth is they don't want their income (which comes from the interest on accounts managed) to be treated as normal income. For pete sake, if that is how you are paid then it is apart of your income, and thus it should be tax as income, not as a capital gain.
"I believe there's a tendency of certain members of the Democratic Party to pursue tax changes as part of some soak-the-rich strategy without thinking about the longer-term consequences to the overall economy," Johnson told The Hill.

Sound familiar...

Johnson also tried to put forward the ridiculous claims that raising the tax would make it harder to "lure" minority talent from top investment banks, and futher claiming that this will lend to the skepticism of minority-run funds because they won't have the best and brightest.
"Investors are skeptical already about the ability of minorities to manage funds and, if you don't have the best and the brightest, you're going to be in worse shape."

First, while I understand that you want to have blacks in places of power, if you are a investment company you should be looking for the best and brightest regardless of color. Your business' track record should be what attracts talent. In any case, he has been making the rounds to all of the Congressional Black Caucus members, as well as some republicans, namely Eric Cantor.
Johnson has shared his concerns with Rep. Charles Rangel (D-N.Y.), the Ways and Means panel chairman, who is the sponsor of the legislation, along with Rep. Sandy Levin (D-Mich.). He said he also plans to meet with Ways and Means member Stephanie Tubbs Jones (D-Ohio) and Rep. James Clyburn (D-S.C.), the Democratic whip.

[snip]

Cantor welcomed Johnson's support in his fight against the tax proposal, saying he agreed the proposal would hurt minority-run firms. "It demonstrates again that this measure doesn't just target the Wall Street investment class," he said.

But Levin states in best
"We're not changing the tax rates on investment. It's not going to affect the [tax] credits on investment that are available for underserved areas. If we need more credits, we should deal with them specifically," Levin said.

In other words, if you have an fund account that has $100 millions dollars in it and let say it has earn 10%. Taxing the 10% doesn't change the fact that you still have the original $100 million which can still be used to provide resources to underserved communtities.

This is what you call conflating issues.

Tags: bad habits, bet, Bob Johnson, Estate Tax, Hedge Funds, investment (all tags)

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