National AFL-CIO wants to close loophole that
allows hedge fund managers to pay less in taxes
(Editor’s Note: The following are
remarks by AFL-CIO Secretary-Trea-
surer Richard Trumka before the Euro-
pean Trade Union Confederation’s
2007 Congress in Sevilla, Spain.)
“I want to thank the European Trade
To The Labor Movement — The Folks Who
Brought Us the Weekend.
Have a Safe and Restful Labor Day.
You Earned It!
Phone: 360.696.1993
Fax: 360.696.2013
P.O. Box 5016
Vancouver, WA 98668
Authorized and Paid for by Brian Baird Democrat for U.S. Congress
Union Confederation and John Monks
for inviting me to speak with you on
this critical subject. This city has
proven a wonderful host and I look for-
ward to strengthening our alliances
over the next few days.
“In the time I have, I want to ex-
plore what we are doing in the U.S. to
confront the booming market in private
equity buyouts, and also voice our
strong support for the actions being
taken by our European brothers and
sisters.
“John Monks set the tone for this
battle during his Bevan lecture last
year, where he described the “new cap-
italism” that is threatening economic
security and the progressive social or-
der established in the European Union.
John’s remarkable speech positioned
the labor movement at the center of the
discussion on financialization.
“The stakes both here and globally
could not be higher: what are the val-
ues that govern democratic societies?
The greatest risk posed by private eq-
uity is the danger that it’s deepening
the societal divide being caused by
globalization.
“The numbers we see emerging are
staggering. The top 25 U.S. hedge fund
RICHARD TRUMKA
managers last year earned $14 billion
dollars, enough to pay New York City’s
80,000 public school teachers for
nearly three years. James Simons of
Renaissance Technologies alone
earned $1.7 billion last year.
“To add insult to injury, these record
profits are taxed at a lower rate under
George Bush’s tax cuts. A large portion
of U.S. fund manager pay is taxed at
the long-term capital gains rate, which
is less than half of the top income tax
rate that American workers pay on
their wages.
“Now I know why these managers
grin when hedge funds are described as
a fee structure in search of an asset
class. They’re laughing all the way to
the bank while workers face stagnating
income, retirement insecurity and dis-
appearing health care coverage.
“As you all know, these funds are
also beginning to wield power over the
boardroom as shareholder activists.
But because they are focused on short-
term returns, they are unconcerned
with good corporate governance. In-
stead they use proxy fights to seize
control for themselves.
“Here in Europe, private equity
funds have begun their assault on
workers’ standard of living. In Ger-
many, Deutsche Telecom has de-
manded that tens of thousands of its
employees be outsourced to an affiliate
who would pay dramatically lower
wages and benefits for doing the same
work they did for Deutsche Telecom.
It’s no coincidence that private equity
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T HIS L ABOR D AY IS A T IME
TO T HANK A MERICA ’ S
W ORKING F AMILIES !
Because of your efforts, this session of Congress is
already making a difference for working men and
women, students and our senior citizens.
W ORKING TOGETHER , GREAT THINGS
ARE POSSIBLE IN THE MONTHS AHEAD
O REGON C ONGRESSMAN E ARL B LUMENAUER
PAGE 22
NORTHWEST LABOR PRESS
AUGUST 17, 2007