In my lecture, The Costs of Estate Tax Dithering, 43 Creighton L. Rev. ___ (2010), I talked about the curious politics behind the estate tax repeal movement, including the important role played by the African-American and LGBT communities in supporting estate tax repeal (as reflected in a West Wing clip). Robert L. Johnson, founder of Black Entertainment Television (BET), played a leading role in the African-American community's push for estate tax repeal. Mr. Johnson on Tuesday issued this statement arguing that the proposed carried interest tax increase in the financial regulation bill would hurt minority businesses, entrepreneurs, and jobs:
“In my opinion, this legislation would cause a rapid decline in minority private equity firms and possibly eliminate minority participation in this important financial sector of the American economy.
Minority firms have difficult challenges in attracting fund investors and an even more difficult time attracting top managerial talent. If this legislation is approved, it will become even more daunting for minority firms. Historically, minority firms generate less investment capital than major firms, require more time to raise funds compared to larger firms, and, as a consequence, if taxes are raised on minority companies the same as it exists for large firms, talented minority men and women would likely choose to stay at their existing firms.