The complicated world of investment firms is understood by few, hence the obscurity and secrecy that still lingers even after the financial sector almost plunged America and the rest of the globe into economic darkness.
This lack of knowledge or understanding may come back to haunt some of us, for many retirements are reportedly bundled up in the gun industry. Yes, that’s right. You may be an investor in the gun used to massacre 26 people, including 20 children, in a Newtown, Conn., elementary school—the tragedy that still has the country moving in slow motion at its unfathomable savagery and the rest of the world looking at us in consternation.
The Daily Beast reports that the private equity firm Cerberus Capital—which owned Freedom Group, the giant maker of the Bushmaster gun used in the Sandy Hook school massacre—have swiftly cut ties with the gun conglomerate. Obviously seeking to distance itself and wash the blood off its hands, Cerberus said in a statement Tuesday that Freedom Group does not sell guns directly to the public, but added, in seeming contradiction, “We do not believe that Freedom Group or any single company or individual can prevent senseless violence or the illegal use or procurement of firearms and ammunition.”
I guess they think that takes care of the blame part and they are now absolved from any kind of responsibility. It’s sort of like the tobacco companies and their manufacturing of those deadly little sticks called cigarettes. We make them, but don’t blame us if you pick one up between your voluntary little fingers and can’t put them down until you’re dying of cancer.
Sorry, I digressed. Now that the good and righteous folks at Cerberus have set the manufacturers of that particular killing machine adrift, do they think they have solved the problem? “As a firm, we are investors not statesmen or policy makers,” read part of their statement. Yeah, right—so the money donated to mainly Republican candidates during the 2012 elections was not dabbling in politics hoping to influence policies, it was simply generous giving. Moreover, Cerberus Capital has “policy makers” on its payroll. High-level politicians like former Vice President Dan Quayle and former Treasury Secretary John Snow.
They hoped that selling their investments in Freedom Group would be a public-relations positive, even if they have to sink the company financially. Which brings us to this: Just who invests in portfolios like Freedom Group? The Daily Beast writes that we may be surprised whose retirements are wrapped up in gun sales.
“From its inception, the industry has raised money from public-employee pension funds—taxpayer-funded retirement-savings programs for teachers, DMV clerks, bureaucrats, sanitation workers, and police officers,” writes The Daily Beast.
The article goes on, “Huge institutional investors like the New York State Common Retirement Fund, CALPERS (the California Public Employees Retirement System), and CALSTRS, which invests on behalf of California teachers, possess hundreds of billions of dollars in assets and are mainstays of the private-equity business. When Cerberus, and the Blackstone Group, or Bain Capital uses debt to boost returns, and use the bankruptcy code to shuck obligations, a big chunk of the benefit goes to civil servants.”
Private-equity firms like Cerberus raise money from public employees. So teachers, firemen and other civil servants unknowingly build their retirement partly from gun sales and who knows what other questionable investments? Oh, what a twisted web we weave.
You can read more at Cerberus to Sell Stake in Gunmaker Freedom Group.