Over the last three years, former Florida Gov. Jeb Bush has set up at least three private equity funds, incorporating in countries like the United Kingdom and soliciting foreign investors from China and elsewhere. His most recent venture was first disclosed in a Nov. 27 filing with the Securities and Exchange Commission. Bloomberg Politics’ Joshua Green laid out the web of Bush’s financial dealings in a new report Thursday, revelations that raise both substantive and practical questions about his prospects for a presidential candidacy in 2016.
Bush was named chairman and manager of BH Global Aviation, described by Bloomberg as a “new offshore private equity fund” that raised $61 million in September. It was incorporated in November in the United Kingdom and Wales, which experts told Green functioned as a tax haven for overseas investors.
According to Bloomberg, Bush has also launched another $26 million fund, supported by a Chinese business conglomerate, and a $40 million shale oil exploration fund in the last two years through a Florida-based holding company. All three funds are under the auspices of Bush’s Florida company Britton Hill Holdings.
The Bloomberg report paints a political picture that could be very difficult for Bush to overcome should he decide to run for president, as his own family and some establishment Republican donors are reportedly urging him to do.
First and most obviously — the Bloomberg report is titled: “Jeb Bush Has a Mitt Romney Problem” — Bush’s business ventures exist in a similar world to those of 2012 GOP presidential nominee Mitt Romney. A murky universe of offshore tax havens and foreign investors that would seem entirely at odds with the country’s political mood that has lingered since the Great Recession and proved to be the most potent attack against the party’s last nominee.
To that point, American Bridge, the Democratic opposition research outfit that has already compiled dossiers on almost every potential GOP 2016 candidate, was pushing out Green’s story just hours after it was published.
There is secondarily a more practical question: Bush was still setting up these funds a month ago, and they generally have a life of at least 10 years. While it might not be impossible for Bush to pull out so quickly should he decide to run, it would be “unusual,” as one academic told Green.
Still, while he was setting up more offshore businesses, Bush’s presidential prospects bubble has been expanding. His son, George P., said with near certainty that Bush would run. Real Clear Politics scooped last week that his confidants had been recruiting political operatives in New Hampshire for a 2016 bid. The New York Times reported on Monday that Bush was among three candidates — another, ironically, was said to be Romney — that deep-pocketed GOP donors were considering backing to avoid another vicious primary season.
But that was before Green unveiled the full scope of Bush’s foreign financial adventures. Ever since he left office in 2007 — with a net worth of about $1.3 million — Bush was transparent about his intention to make money. He advised Lehman Brothers, whose chief executive reportedly considered at one point asking Bush to enlist President George W. Bush to intervene on the company’s behalf during the 2008 financial crisis.
More recently, Bush has set his sights on China. One of his funds raised $26 million from investors that included a major Chinese financial group and it then turned around and invested in a shipper of liquid petroleum gas incorporated in the Marshall Islands. His most recent venture, the one incorporated in November, received funding from the CEO of a Beijing-based private equity fund, Green found, and, in fact, 98 percent of that fund’s money came from “non-U.S. persons.”
“For the Chinese, the Bush name and the Bush connections to energy are a natural marriage,” Derek Scissors, a scholar at the American Enterprise Institute with an expertise in American-Chinese economic relations, told Green, adding of the Chinese firms: ‘They’re looking for political protection, and the Bush name legitimizes the investment and makes him a perfect partner.”