The Red Herring: Carlyle’s Way. Yet another overview of the Carlyle Group, one of the best examples of crony capitalism going. The formula is simple, hire lots of former politicians with heavy duty pull, buy struggling businesses in industries with strong government ties, have your hired guns use their access to get new government contracts for those businesses, sell the suddenly refurbished businesses. The article even offers an example of the Carlyle Group’s approach:
United Defense makes the controversial Crusader, a 42-ton, self-propelled howitzer that moves and operates much like a tank and can lob ten 155-mm shells per minute as far as 40 kilometers. The Crusader has been in the sights of Pentagon budget cutters since the Clinton administration, which argued that it was a relic of the cold war era–too heavy and slow for today’s warfare. Even the Pentagon had recommended the program be discontinued. But remarkably, the $11 billion contract for the Crusader is still alive, thanks largely to the Carlyle Group.