Title:

Bad Company

Author:

Megan Greenwell

Category:

Non-fiction

Rating:

Date Reviewed:

February 9, 2026

t last I have read a non-fiction book that doesn't warn of the devastating consequences of our collapsing biosphere. But that's about the sum of all the good news. Bad Company ; Private Equity and the Death of the American Dream studies the disastrous effects private equity investors are having on our economy as a whole. The story is humanized by following the life-story of four working Americans whose lives are upended by the infinite rapacious greed of the private equity firms. These four individuals work in four fields: retail, healthcare, newspapers and housing. The book is divided into three sections: Before, During, and After. "Before" describes how the company worked before private equity got involved. "During" explains what happened when private equity looted the company; destroying the company in an endless search for short term profit, and "After", which shows how these citizens responded to the careless crushing of their livelihood by financial firms.

The first of the four tales is about Liz who works at Toys R Us. Liz needs the job to pay bills and put food on the table while her husband works his way through school to earn his pharmacist degree. We learn about the history of Toys R Us, its iconic success and business strategy - and then private equity buys the company and dramatic changes result. I still cannot grasp how the private equity firms can borrow most of the money to acquire Toys R Us, but then stash all the debt onto the books of Toys R Us. It sounds as if KKR and Bain Capital bought Toys R Us for $6.6 billion, and then stuck all of the responsibility for repayment of that debt onto the Toys R Us books - Toys R Us was responsible for paying off the loans used to buy it! Meanwhile, KKR and Bain Capital charged huge "management fees" and did nothing to improve Toys R Us operations. The official explanation is the Toys R Us could not compete against Amazon and Walmart, but despite owning the iconic retail chain, KKR and Bain Capital had zero interest in investing in their new company to make it a thriving operation. They were merely there to loot the assets. Liz's story is that despite her dedication to the store, she received paltry wages. She couldn't understand why the new owners took no interest improving Toys R Us, and why all of her recommendations on how to improve things were ignored by uppper management. When Toys R Us went under, KKR and Bain Capital tried to weasel out of the measely $33 million in severance pay owed to their remaining workers.

Roger's story was that of a general practioner who moved to Wyoming and worked a rural hospital in small town Riverton. Original, the hospital provided services like maternity care to the local population, but it couldn't do everything. When Apollo Global Management offered to buy the hospital, they promised to upgrade the services, providing more health care options - it all sounded like a good plan. But making money in healthcare is all about charging more money while delivering less care, and soon the Riverton hospital is not serving the public as well as it used to. There all kinds of shenanigans of companies buying other companies; ownership changing hands in financial deals that enrich the deal makers with each transaction but don't actually improve healthcare. There are tricks such as selling the land that the hospital sits upon to a private firm (private equity pockets the sale price), and then having the private firm charge the hospital leasing fees. Hospitals are loaded with debt while management pays itself big fees. Roger is a trusting soul at first, believing the new CEO does have Riverton hospital's best interests at heart. But then a co-hort discovers a Power Point presentation describing how Sage West planned to enhance profits while permanently doing away care such as the maternity ward. The CEO was lying all along.

Natalia works in journalism. It is a low paying job, but a career she loves. Unfortunately, private equity firms like Gannet and GateHouse have realized that newspapers can be profitable if they have hardly any reporters. These giant firms buy as many newspapers as they can, decimate the newsrooms, and fill the pages of the paper with syndicated stories. All local content is gone. Small towns becomes news deserts. The same tricks are played - sell the land beneath the newspaper building to a private firm, fire the workers, and structure things financially so that if the newspaper goes bankrupt, the private equity firm isn't liable for any of the debt.

The last industry is housing. Loren has moved her young family into a high rise called Southern Towers, which is owned by a firm called CIM. But the apartments having appalling maintenance - the HVAC spews mold, the elevators break and numerous other problems go unaddressed. Then one day a pipe breaks and begins to flood several apartments. It turns out that there is no way to contact any Southern Towers manager to turn off the water. After the fire department finally shuts of the water, it becomes impossible to get CIM to repair the damage. The reader learns about all the different ways private equity can screw with people's housing - raising rents, withholding maintenance, sudden evictions. One trick is to buy the land of a mobile home park, and then jack up the rates for the mobile homes that sit there - most people cannot afford the $5K to $8K sum that would be needed to move their mobile home to a cheaper park. Private equity can use subsidized government loans to build low income housing, but then there is no requirement to keep the rents low!

The book describes some attempts to reign in these financial games. Elizabeth Warren proposed a bill that fixed a lot of the abuses:

"Most terrifyingly to private equity executives, it [Warren's bill] would force firms to share responsibility for the debt they take out in a company's name; if an acquired company declared bankruptcy or liquidated, the firm that owned it would no longer be off the hook for repaying debtors. In the case of Toys R Us, that would have meant Bain and KKR would have lost their respective $31 million in profits from the deal, and instead would be forced to pay back at least some of the $5.2 billion in debt that they took in the retailer's name. The Stop Wall Street Looting Act would end leveraged buyouts as we know them.".

Of course, Warren's bill is doomed. Private equity pours donations into politicians' coffers on both sides of the aisle. Despite both Biden and Trump promising to close the carried interest loophole, it cannot be killed due to a Senate vote.

The book tries to inject some hope. All-digital newsrooms acting as non-profits can hire journalists to write local news stories. Activists can embarrass private equity firms and force them to maintain their apartments. But it is clear that the politically powerful private equity firms will continue to loot and destroy American companies until climate change destroys our civilization and renders all these financial shell-games moot.