Since private equity has been such a destructive force, particularly in the media sector, a series of reforms targeted at the PE industry are needed. Asset stripping is an especially harmful practice enacted by PE firms; limited liability protections should not be extended to them when they are deliberately looting a company for their own benefit. Immediate dividend payments to PE investors is another exploitative practice, reducing the capacity of the company to invest in its own labor and productivity; regulations that prevent PE firms from paying dividends in the first two years following an acquisition would be an easy fix. The most corrupt PE firms have been using bankruptcy courts to rid themselves of pension and severance pay obligations; PE firms must be held accountable in these situations.

XREF: Contrasts with conventional justifications for limited liability shielding and the mainstream acceptance of PE dividend extraction. SEED: Could develop into a piece on specific regulatory fixes for PE asset-stripping and dividend practices in media consolidation.

Andrew deWaard, Derivative Media, loc. 459