Milken Conference Post-Mortem

Three days is definitely the maximum length of time that anyone can fully engage with a high-intensity conference such as the Milken shindig which finished yesterday. I'm about to get on a plane back to New York, so blogging will be light today. But I do think it's worth taking a step back and looking at the conference as a whole, rather than, say, the potential for converting carbon dioxide into methanol. (Although if someone can point me to a link explaining how that process could work in practice, in terms a non-chemist can understand, I'd be very grateful.)

The Milken conference is probably unparalleled outside Davos for the ability it affords to observe in their natural habitat the market movers after whom this blog is named. It's on the record, but it doesn't feel on-the-record, which is a great credit to the organizers. As a result, people do commit news, partly on purpose but also just by dint of how they answer questions.

There's an interesting tension at the conference: on the one hand, filled as it is with financiers and billionaires, it does tend to lean right. On the other hand, it focuses on liberal causes such as poverty alleviation, primary education, and global climate change. The tension is nearly always resolved in the same way: the best way to address all of these issues, it would seem, is by using market forces and financial innovation.

I think that rich liberals find it very easy to adopt such a stance – there's no need to feel guilty about one's wealth if wealth creation itself is an important tool in poverty reduction and whatnot. So it can be refreshing to see unreconstructed right-wingers like Roger Ailes and Steve Forbes call bullshit on some of the rote liberal pieties. On the other hand, it can also be depressing to see an audience of thousands clearly siding with Bill Frist rather than Arianna Huffington on the subject of whether the US government should be allowed to negotiate the price it pays for prescription drugs. Arianna has the stronger argument, but Frist has a trump card: private sector good, public sector bad. And that plays very well in an audience of capitalists.

Alphaville picks up on the same feeling, reporting from the private equity panel:

Turning to the tax treatment of buyout groups, [David Rubenstein, of the Carlyle Group] sounded a rather menacing note. Responding to the fact that Congress is examining whether to hike the tax rate applied to carried interest, he declared:
“Every partnership in the US is governed by the same capital gains tax rules…If Congress tries to carve us out and tax us differently I think we will have people doing things that aren’t very desirable.”
Whatever can he mean?

What he means is, quite simply, "I don't want to pay higher taxes". And that's a sentiment which goes down very well here.