Blackstone billionaire is sorry for Nazi jab against Obama's tax policies

The billionaire Blackstone private equity boss Stephen Schwarzman, who is among Wall Street's most visceral proponents of the free market, has been obliged to apologise after comparing Barack Obama's tax policies to the Nazi advance across Europe at the beginning of the second world war.

The tycoon, whose empire stretches from Hilton hotels to the Weather Channel, United Biscuits and the London Eye, has worked himself up into a lather about a proposed tax hike on so-called "carried interest" profits - the gains made when private equity firms buy and sell businesses - from 15% to as much as 35%.

"It's a war," he told a board members of a non-profit organisation, whose members leaked Schwarzman's remarks to Newsweek on condition of anonymity. "It's like when Hitler invaded Poland in 1939."

One of Wall Street's most successful financiers of recent years, Schwarzman has a well-developed sense of his own importance in the world. He famously threw a star-studded 60th birthday party for himself at a cost of $3m back in 2007, compete with private performances by Rod Stewart and Patti LaBelle. And he pushed hard against local opposition for New York's main public library to be named the Stephen A Schwarzman Building in recognition of a his charitable largesse back in 2008.

His remarks over tax policy have left a sour taste in certain quarters. Elan Steinberg, vice-president of the American Gathering of Holocaust Survivors and their Descendants, asked the New York Times: "What was Stephen Schwarzman thinking? For the victims of Hitler's Germany, such insensitive remarks trivialise their suffering and cheapen public discourse. Mr Schwarzman, shame on you - find a better way to save on your taxes."

There's a rigorous debate underway surrounding the taxation of private equity activity. Democrats in Congress view the industry's low rate as a loophole, and feel that private equity bosses' healthy returns should be taxed along the same lines as income. The private equity industry demures, arguing that its participants are entrepreneurs who pump large amounts of risk capital into the economy, often revitalising moribund businesses.

Schwarzman expressed regret for his comments, telling the New York Post: "I apologise for what was an inappropriate analogy."

But he added: "The fundamental issue of the administration's need to work productively with business for the benefits of the overall economy is still of very serious concern not only to me, but also to large parts of the business community."

Schwarzman's fortune is estimated by Forbes magazine at $4.7bn. It isn't the first time that he has invoked wartime atrocities to make a business point. He once compared Blackstone's unsuccessful attempt to buy a mortgage company in the midst of the subprime homeloans crisis to the devastation wreaked by an atomic bomb dropped on Hiroshima in 1945.