Towards a people's capitalism; it is just as good as socialism

Comrades,

I have included this article about Stephen Schwarzman in your information packets this week.

This is our future.

Even the Chinese Communist Party encourages people to go into business to amass great wealth.

President Obama is shaping an entirely new and bright future. As our friends in the Progressive Democrats of America enthusiastically point out the stock market has begun to recover regaining much of its losses. Capitalism hit a little bump. Recovery is within sight. I agree with the estimates that we will be seeing a 2009 recovery.

We have remodeled our offices placing us on the cutting edge as our country emerges from a little recession with the new people's capitalism holding out great promise and opportunity to all willing to put forward a little effort.

This is what I had in mind as I reflected on a Springtime of Possibility.

We are on the threshold of a transformational society. Industry and politics has been completely revamped with socialists the tools of capitalism to create a new post industrial society where anyone who wants to can become rich.

There were the doubters who said President Obama couldn't bring us out of a little recession but a new kind of capitalism has emerged stronger and more resilient than ever because this time middle class intellectuals are the engineers and architects of this new way forward.

We don't have leaders coming from log cabins as Lincoln did (I have included plastic Lincoln logs in each of your packets, also. See what you can build). No we have leaders like President Obama and Ben Bernanke who come from very modest backgrounds. These are people who will never forget the very modest backgrounds they have come from.

We have helped bring together a winning team. Our skills remain unmatched.

Comrade Marquit from Minnesota who among our front-rank fighters helping us to get control of the Minnesota Problem has suggested we begin using only our abbreviated name: CPUSA. I agree. It is more corporate sounding. It projects where we want to be headed. It is not necessary for these letters to stand for anything.

Get to your computers. Start investing. President Obama tells us there are profits to be had for the taking.

Sam Webb
Chair, CPUSA




The Guardian (London) - Final Edition

The Guardian profile Stephen Schwarzman: An expert in branding himself, he has gone from being a very rich nonentity to being the poster child for capitalist success: Fabulously wealthy private equity boss is New Yorks man of the moment

BYLINE: Andrew Clark, New York

After a tough day of deal-making, it is only right that the king of Wall Street should retire home to a palace. Stephen Schwarzman does just that
- his Manhattan apartment boasts 35 rooms including a foyer the size of a ballroom, his-and-hers saunas, a pine-panelled library, 11 fireplaces and 13 bathrooms.

Works by Claude Monet and the American abstract artist Cy Twombly adorn the walls of the two-floor, 20,000 square foot Park Avenue residence. In pride of place, according to visitors, is a silver-framed photograph of Schwarzman arm in arm with President Bush.

Brash, well-connected and fabulously wealthy, Schwarzman, 60, is New York's man of the moment. The Pennsylvania-born boss of the Blackstone private equity empire has been at the forefront of a rush of multibillion-dollar deals to snatch public companies away from the prying eyes of the stock market.

Blackstone's investments have included $12.7bn (£6.4bn) for the market research firm Nielsen, $3.2bn for United Biscuits, $2.3bn for Orangina and $3.6bn for Merlin Entertainment - the owner of Madame Tussauds, Alton Towers and the London Eye. In November, the firm smashed records by paying $38bn for US property firm Equity Office Properties.

The son of a curtain store owner, Schwarzman is not blessed with deep reserves of patience, and to describe him as competitive would be a reckless understatement. "I want war, not a series of skirmishes," he told one interviewer this week. "I always think about what will kill off the other bidder."

The business channel CNBC has dubbed him the premier capitalist in America. In a March cover story, Fortune magazine crowned him as Wall Street's monarch.

This week, Blackstone was compelled to disclose the extent of his riches in a prospectus for a stock market flotation, and revealed that Schwarzman took home $398m in cash last year. When the firm goes public, he will scoop at least $449m and his ongoing 23% stake in the business will be worth $7.7bn.

Blackstone points out that these sums reflect the fact that Schwarzman invested his own money to start the firm in 1985. But to some, he has become a poster boy for financial excess.

Richard Ferlauto, director of investment policy at the American Federation of State, County and Municipal Employees, says Schwarzman benefits from favourable tax breaks and is setting a benchmark bound to drag up boardroom pay elsewhere: "How much incentive does he need, given his direct ownership of the company, to get him to produce more for his limited partners?"

Another union, the SEIU, is more measured. It says private equity has an opportunity to shape companies in a beneficial way for both workers and employers. But spokesman Andy McDonald adds: "Right now, the econo my's doing very, very well for a small number of people but there's a much larger group for whom wages are stagnant and healthcare is hard to come by."

By definition, private equity is low-profile. Its logic is to take companies with long-term challenges out of the public gaze and to restructure them without day-to-day scrutiny from investors. Blackstone's rivals - KKR, Texas Pacific and Carlyle Group - shun the limelight. Schwarzman, though, is different. Short, grey-haired and softly-spoken, he is renowned for his exotic parties. His Christmas event was themed on 007, with Bond girls sashaying around with trays of nibbles. Then in February, he spent an estimated $3m on a birthday bash featuring private performances by Rod Stewart and Patti LaBelle at a regimental armoury on Manhattan's upper east side. The venue was decorated to look like Schwarzman's own living room, complete with a huge portrait of the host himself. Guests included Colin Powell, Donald Trump and mayor Michael Bloomberg.

Typical of Schwarzman's prestige is his choice of living space. He paid $30m in 2000 for his apartment, which was previously the home of the Mayflower descendant George Brewster, John D Rockefeller and computer leasing magnate Saul Steinberg. "Each one of them, in their way, was the ultimate capitalist of their age," says Michael Gross, author of 740 Park, a book about the building. "Not only is it the best building in New York - but it is the best apartment in the best building."

Schwarzman is married to Christine Hearst, an intellectual property lawyer who, unusually, has kept the name of her first husband, Austin Hearst, grandson of the legendary newspaper tycoon Randolph Hearst. Nomenclature is important to the couple, suggests Gross: "This is a man who is an expert in branding himself - and he has done so brilliantly. He's gone from being a very rich nonentity to being the poster child for capitalist success. Stephen Schwarzman is now know as the epitome of American capitalism."

Educated at a suburban Philadelphia school, Schwarzman attended Yale University at the same time as George W Bush and both were members of the elite Skull and Bones society. He worked at the investment bank Lehman Brothers before quitting to set up Blackstone with a colleague, Peter Peterson. The firm is a play on their names - "schwarz" is the German for black and "Peter" is derived from the Greek word petrus, meaning stone.

Schwarzman remains close to President Bush, who attended a Republican fundraiser at the private equity tycoon's apartment in April. Some say he covets the job of treasury secretary. If he ever gets it, America's treasury mandarins should expect to be pushed hard - Schwarzman boasts that he requires nothing less than a "zero-defect culture" in all his dealings.

The CV:

Born February 14 1947

Family Married to Christine Hearst, a lawyer. Three children between them from previous marriages

Education BA from Yale; MBA from Harvard business school

Employment Began at Lehman Brothers; managing director by 31. Left 1985 to co-found Blackstone

Interests Chairman, Kennedy Centre for Performing Arts; board of New York Public Library; member Council on Foreign Relations thinktank