Jackson Free Press

In its Sunday edition, The New York Times is reporting that New York Attorney General Eric Schneiderman is investigating several private equity firms, including Bain Capital for possibly abusing a tax strategy "in order to slice hundreds of millions of dollars from their tax bills."

The attorney general, Eric T. Schneiderman, has in recent weeks subpoenaed more than a dozen firms seeking documents that would reveal whether they converted certain management fees collected from their investors into fund investments, which are taxed at a far lower rate than ordinary income.

Among the firms to receive subpoenas are Kohlberg Kravis Roberts & Company, TPG Capital, Sun Capital Partners, Apollo Global Management, Silver Lake Partners and Bain Capital, which was founded by Mitt Romney, the Republican nominee for president. Representatives for the firms declined to comment on the inquiry.

Mr. Schneiderman’s investigation will intensify scrutiny of an industry already bruised by the campaign season, as President Obama and the Democrats have sought to depict Mr. Romney through his long career in private equity as a businessman who dismantled companies and laid off workers while amassing a personal fortune estimated at $250 million.

The subpoenas, by a Democrat, went out before a huge document leak recently that raised questions about Bain Capital's practices:

The tax strategy — which is viewed as perfectly legal by some tax experts, aggressive by others and potentially illegal by some — came to light last month when hundreds of pages of Bain’s internal financial documents were made available online. The financial statements show that at least $1 billion in accumulated fees that otherwise would have been taxed as ordinary income for Bain executives had been converted into investments producing capital gains, which are subject to a federal tax of 15 percent, versus a top rate of 35 percent for ordinary income. That means the Bain partners saved more than $200 million in federal income taxes and more than $20 million in Medicare taxes.

The subpoenas, which executives said were issued in July, predated the leak of the Bain documents by several weeks and do not appear to be connected with them. Mr. Schneiderman, who is also co-chairman of a mortgage fraud task force appointed by Mr. Obama, has made cracking down on large-scale tax evasion a priority of his first term.

As a retired partner, Mr. Romney continues to receive profits from Bain Capital and has had investments in some of the funds that documents show used the tax strategy.

Be sure to read the entire article for a succinct explanation about the fees/interest practices of many financial firms. This ends the piece:

The leaked documents show that Bain has in recent years waived management fees in at least eight private equity and other funds, including one formed as early as January 2002. The documents stated that Bain executives had the right to decide either annually or each quarter whether to waive some or all of their management fees; they also had …

I received this stunning letter a couple days ago from a (white, I think) man in Pearl, presumably in response to my recent column about the abominable Mississippi state flag. I post it now without comment but will be back along with some thoughts later. Here it is, verbatim:

Please permit me to submit the following letter to Jackson Free Press:

Some of us have heard the question "What happens when an unstoppable force hits an immovable object?" The puzzle might seem a bit superficial until one notices we have a similar problem concerning our state flag.

I think the JFP has well demonstrated that the Confederate emblem on the Mississippi flag continues to cause hurtful memories to blacks who have endured the horrors of segregation and the Civil Rights era.

So why would so many Mississippians continue to resist changing such a hated symbol of our state's dark past? Ignorance? Bigotry? Could there still be some unspoken reason why many white southerners insist on keeping our flag in its current form?

Hey. We want progress. So let's just go ahead and bring it out in the open.

Just as the current Confederate emblem causes hurtful memories to our state's blacks, the absence of the symbol would cause hurtful memories to many white southerners. And I do not mean just segregationists.

To many whites, the erasure of the Confederate emblem would be an unreciprocated nod to the kind of blacks who attempted, and in some cases, DID seize control of Jackson's schools by force, who pulled knives on white students and threatened them with violence, who stole my brother's school books and urged him to steal from my parents to get money to get his books back.

The erasure would be seen as a nod to "gangsta rap" stars who record songs saturated with sexualized slang and glorify abusing women. It would be seen as a nod to people who have petitioned the NBA to declassify the use of the "MF" word as a technical foul because it is part of "black culture."

To be blunt, there are some facets of "black culture" many of us do not want in Mississippi culture. THAT is what some Mississippi southerners are afraid of.

Though voters decided by referendum to keep our current flag, one can argue that we must have a system in place to protect people from a tyranny of the majority. But there is a bit of a corollary to that here.

If Mississippi blacks are a minority, there is a tiny minority to THAT minority. There are some blacks who want to keep our current flag. Some support groups like the Sons of Confederate Veterans because they are proud to be the descendants of black soldiers who fought for the CSA. Should not their rights be considered too?

But my position is not based entirely on fairness. Perhaps we should lose the current flag.

But that is not going to happen until we have answered the …

First, the back story: After a crazy week of watching the Republican National Convention, and yelling at chairs and TV screens, I decided to take today off, lounge and do some light reading. My guilty pleasure is reading fashion/decor magazines. So I spent much of the morning in bed with the huge September fall-fashion issue of Elle. On page 382, though, politics popped up--in a fabulous section where Elle editors declared a "War FOR Women." The pages are packed full of facts and inspiration for women voting, running for office, and donating to candidates with our best interests and rights front of mind.

Suddenly, I was inspired to join this War FOR Women force in every way I can—both blogging on the JFP site, in social media, in special sections and articles in the Jackson Free Press, and here on the site.

First, I'll start by sharing a statistic that everyone needs to understand, per Elle: "Of the 683,000 jobs lost by women since 2009, 64 percent have been public-sector jobs.

It simply makes me crazy that so many people do not understand that every cut to government spending affects jobs and, thus, our economy. That doesn't mean that I don't want cuts: I consider myself a fiscal moderate and I believe in smart, yet compassionate government spending. And smart spending that helps stimulate our economy and, like the smartest businesspeople, invest in the nation's future (as Bush and Obama did with the auto bailout, which turned out to be a very good investment of government money, although at the time we had to spend). Every actual business person knows that running anything like a business often means investing by borrowing money or having smart debt, although you wouldn't know to hear the political anti-government rhetoric from the right.

Anyway, I hadn't seen these numbers on the jobs that women have lost -- even though I had heard Mitt Romney's rhetoric about the recession hitting the women harder than men--which isn't actually true.

What Romney isn't saying, but Factcheck.org explains in detail, is that while women have more jobs in the recession since Obama came to office, most of those are government jobs--the very jobs Republicans want so desperately to cut. And think about it: Right here in MIssissippi, and Jackson especially, so many of our jobs are public sector, with no small number dependent on federal dollars. Imagine if the Paul Ryans of the world get their way and just start slashing. What happens to jobs of women and men right here in Mississippi? The same thing that has been happening. That's why stimulus is so vital.

Here's more of what Factcheck said about Romney's cynical "war on women" claim:

Looking back at the whole recession, men have lost many more jobs than women. But the biggest job losses for men came earlier in the recession, and recovery for men has come faster than it has for women. ... What the graph shows clearly, and …

This open letter to mayoral candidate Jonathan Lee just came via email. Here it is, verbatim:

Jonathan Lee Candidate for Mayor of Jackson Public Letter

Dear Mr. Lee:

After watching one of your recent campaign commercials in which you portrayed Chokwe Lumumba as radical and racist, I was compelled to offer you a different world view.

I am a native of Yazoo city, the hometown of Michael Espy and Haley Barbour, two of our state’s most recognized political figures. Like Mike and Haley, I am a product of the public schools system, a graduate of Yazoo City High School. My ACT scores ranked me in the top 10 percentile in the country, and I was fortunate to earn distinction as a National Merit Finalist and accordingly received numerous scholarship offers.

Sarah King, my black, Northwestern University-educated high school guidance counselor told me….”You need to matriculate at Williams College, where you will be nurtured and taught to be a critical thinker. With a Williams College education, you will be equipped to change the world when you return to Mississippi. ”

So, naturally I chose Williams College in Williamstown, Massachusetts. Mrs. King was right on point. Williams College satisfied my natural thirst for knowledge and enlightenment, but it also showed me how easily one can cast seeds of discord and destroy a community.

Williams had a total of 60 black students enrolled in all classes. All of the students, from every conceivable ethnicity, were the top students in their high schools. A staff person in the admissions office remarked in one of the dining halls that they were pleasantly surprised at how well the minority students were performing – – especially the “10 percenters”. What was a 10 percenter?!

Shortly after this statement resonated, the campus newspaper ran a story that said Williams College was participating in a social experiment known as “Affirmative Action” and had elected to admit 10% of the students who would not ordinarily qualify for admission to the college.

The college wanted to honor its moral obligation to society by giving underprivileged, socially disadvantaged students the opportunity to obtain a Williams college education, but the newspaper article made the “10 percenter” concept appear as something to be ashamed of instead of portraying it as the wonderful program that it was.

Almost immediately, all students were trying to determine who was a 10 percenter. Some of them would be mean-spirited and say things that were destructive. A few said things like, “we know Herb Irvin is a 10 percenter, because he is from Yahoo, Mississippi”! All of a sudden, the black students were no longer on academic parity. Because of this 10 percenter phrase, the black students’ academic ability and capacity were questioned by the non-black students and the faculty, as well as by their fellow black students.

Some of the best black students left before graduation, because they didn’t believe that they earned the right to be there.

Against the advice of my classmates and friends, I …

The JFP got more great news Friday night when we learned that we are winning two first-place and one second-place award from the Society of Professional Journalists' southeastern division. Valerie Wells takes first place for feature writing, the Personhood team (this time, including R.L. Nave and Adam Lynch) takes second place for public service, and I won first place for serious commentary. Here is the full press release. Cheers to the team, congratulations to all the winners. We're honored to be in your company: