Brendan McDermid/Reuters
- "The far left itself could be exceptionally disruptive to the country as a whole if that agenda of several of the candidates is really implemented," Stephen Schwarzman told Business Insider on the sidelines of the World Economic Forum in Davos, Switzerland, last week.
- Schwarzman cited the liberal agenda of some of the Democratic presidential candidates, passing reference to the Medicare for All policies put forth by several of the candidates.
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Stephen Schwarzman doesn't like what he sees from some of the Democratic Party's most progressive policies.
The Blackstone CEO and registered Republican said some of the policies coming from the other party's presidential hopefuls, including one focused on putting every American into government-backed health insurance, would be disruptive for the country. Schwarzman is also an adviser to President Donald Trump.
"The far left itself could be exceptionally disruptive to the country as a whole if that agenda of several of the candidates is really implemented," Schwarzman said on the sidelines of the World Economic Forum last week, declining to name any specific candidates.
Presidential hopefuls Elizabeth Warren and Bernie Sanders have floated plans for a single-payer healthcare system that has been dubbed Medicare for All. The plans would require a gradual move away from employer-provided health insurance. Roughly 170 million people in the United States currently get their health insurance from their employers, according to some estimates.
Your employer-provided health insurance "would be over and you'd just be part of the government program," said Schwarzman, answering a question about what specific policies he had in mind. "That would only affect 170 million people. That is the definition of disruptive."
Schwarzman, who founded private-equity behemoth Blackstone in 1985, has long been associated with Republican administrations. He donated to President George W. Bush's campaign and he's known Trump for years.
Schwarzman headed Trump's Strategic and Policy Forum, an economic advisory council made up of top business executives. The group disbanded in the wake of Trump's comments around the Charlottesville, Virginia, riots in August 2017, where the president refused to condemn white nationalists who sparked violence that ended with one person killed.
Since then, Schwarzman has continued advising the president.
Schwarzman's comments come in an election cycle that has seen the private-equity industry drawn into the early campaigns of some candidates, including Elizabeth Warren. The candidate has likened PE firms to vampires that suck the life out of companies by loading them with debt, laying off workers and profiting even when their companies go bankrupt.
The candidate has taken aim at the firm's investments, including owning a stake in a company that she said contributed to deforestation in the Amazon. She also has said Blackstone "shamelessly" profited from the 2008 housing crisis by buying apartments and single family homes that had been foreclosed.
In both instances, Blackstone issued statements in response saying that the accusations against the Brazilian company Warren referenced, Hidrovias, were "erroneous" and that there was nothing wrong with its housing investments.
The firm said in a November blog post that its portfolio companies have added a net 100,000 jobs since 2005.
Schwarzman said in last week's interview that it wasn't just the prospect of doing away with private health insurance that gave him cause for concern, but also a broader change in business policy a progressive Democratic presidency could bring.
"Usually when people get disrupted, their economic behavior changes," Schwarzman said. "If they feel threatened then they typically spend less, save more. Businesses themselves would invest less which would create pressure on jobs."
He added: "It's a whole cascade of things that stem from people being exceptionally uncertain if the rules of existing life for them should really change."