Blackstone Co-Founder Peterson On Wealth, McCain, And Fiscal Responsibility

Peter G. Peterson is a man of parts: leveraged-buyout billionaire, policy wonk, social lion, and--most recently--the patron of an ambitious new foundation (named, like the Washington think tank he chairs, after himself) that aims to alert Americans to the dangers of mushrooming deficits, exploding entitlements, and gluttonous oil addiction.

At 81--rich, privileged, and well-connected beyond his dreams--Pete Peterson is an unlikely Paul Revere. He's the Nebraska-born son of striving Greek immigrants, who studied hard, excelled in business (rising through the ranks of the McCann Erickson advertising agency and then running Bell & Howell), and impressed the likes of philanthropist John D. Rockefeller III and former Treasury secretary Douglas Dillon with his public-spirited bent. They sponsored his induction into the American Establishment, and Peterson ended up serving as Richard Nixon's international economics expert, and then Commerce secretary, before running Lehman Brothers for more than a decade. In 1985, Peterson was nearly 60--and ripe for a rewarding retirement--when he and a young financial whiz named Stephen Schwarzman decided to start a small private equity firm, the Blackstone Group, whose name was an amalgam of theirs (schwarz meaning black in German and petros meaning stone in Greek). Now the senior chairman of the hugely successful firm, Peterson received $1.8 billion as a result of Blackstone's initial public offering and plans to pump as much as a billion dollars of his own money into his new foundation. Three weeks ago, he sat down with Portfolio.com for an exclusive interview.

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