Here is a (non-exhaustive) list of reasons why Democrats and Republicans alike would be wise to avoid private equity bashing:

1. Private equity keeps afloat public employee pension funds. No doubt about it, out state and local pension funds are in trouble. Pension givebacks by labor have already occurred in Rhode Island, for example, with that state just the demographic canary in the funding-deficit coal mine. Private equity has provided and continues to provide outsized returns on investment to public employee pension funds, which are among the biggest investors in private equity. All told, pension funds account for more than 40 percent of all private equity investors. If you’re a friend of labor, you want these returns to continue. (Note: University and charitable foundation endowments are among the next largest types of investors).
2. Private equity is a huge and growing employer. Worldwide, private equity employs over 8 million people and there are over 14,000 companies in the United States that are backed by private equity. This is a huge constituency. The debate over whether private equity business practices create or eliminate jobs is in some ways beside the point. A lot of people (read: voters) depend upon private equity for their livelihoods and must not be too happy to read in every morning paper their companies and management being mercilessly bashed by politicians.
3. Private equity is an incredibly successful export. You’d never know it by listening to the pundits, but one of the most successful American exports is financial innovation; private equity financial and management techniques have been imported the world over. The Chinese can’t get enough joint ventures with U.S. private equity sponsors and this is proving to be a key lever for American investment opportunity in growing markets throughout Asia. Make political pariahs out of our best innovators and watch them leave for greener pastures – Hong Kong will snap our best people up in a heartbeat.

Richard Farley is a leveraged finance partner in the New York office of global law firm Paul Hastings.