Peter G. Peterson, a Beneficiary of Private Equity Tax Breaks, Establishes Charitable Foundation to Promote Fiscal Discipline

On February 15, 2008, the New York Times reported that Peter G. Peterson, a wealthy beneficiary and proponent of tax breaks for private equity, has formed a private foundation that will promote fiscal discipline by government.  Peterson has tapped none other than the U.S. Comptroller General, David Walker, to run the foundation.  David Walker announced on the same day of the New York Times story that he will be resigning from his government post. Here is an excerpt from the New York Times story:

On Friday, Mr. Peterson will unveil the Peter G. Peterson Foundation and announce his plan to allocate his newfound billions to projects that will increase public awareness of fiscal imbalances, Social Security deficits and nuclear proliferation.

But the larger question that was posed by Mr. McCurry is unavoidable: Can a man who has scored riches from an industry that has benefited from a generous, controversial tax break emerge as a credible voice in favor of broad fiscal constraint in Washington?

It is a quandary that has plagued Mr. Peterson for years. And while he supports increased taxes on the wealthy (along with broad-based benefit reductions), he remains firm in his defense of the special provision for private equity partnerships despite the view of many on Wall Street, including the billionaire investor Warren E. Buffett, that the rate is too low.

. . .

Out of the gate, the Peterson foundation will be worth about $100 million and Mr. Peterson expects it to grow to $1 billion, a large part of his total fortune.

He has hired David M. Walker, the respected head of the Government Accountability Office, to be chief executive and has already committed $5 million — a grant that will be matched by Mr. Buffett — to the former Senator Sam Nunn for his work on curbing nuclear proliferation, as well as funds to the Concord Coalition, a group he helped found that lobbies for deficit reduction.

For the entire story, see “Tax Break Helps a Crusader for Deficit Discipline” in the February 15, 2008, New York Times.

DAB