What is private equity, and why is it killing everything you love?

In July 2010, Doug Lowenstein, CEO of lobbying group the Private Equity Council, wrote a letter to PBS NewsHour after a segment it had aired on the private equity industry. He noted some “concerns” the group had with the show’s piece, including that it had ignored “hundreds of examples of PE success stories.” His chosen example: Toys R Us, which had been bought out by a trio of firms in 2005.

“[Y]ou don’t report that Toys ‘R Us was saved from likely bankruptcy by PE owners, that it has more employees working for it than it did before it was acquired, and that it is on the verge of returning to the public equity market,” he wrote.

Toys R Us never went public; it went bankrupt seven years later, in 2017. And all those employees? They lost their jobs.

The Private Equity Council, now rebranded as the American Investment Council, kept trucking along. So did the three firms that bought up Toys R Us — and, eventually, saw it go under.