A tip of the hat to the Journal’s Dennis Berman for his column today on the private-equity industry.

Remember them? The guys who used other people’s money to buy companies, leverage them to the gills, strip out hefty dividends for themselves and hope to spin the companies off in an IPO down the road?

They used to be known as leveraged-buyout firms or Barbarians at the Gate back in the eighties. The debt they loaded companies with made it harder for them to operate, forcing heavy layoffs, and LBO groups often stripped their acquisitions of assets. The industry got a dirty name.

Then, in a brilliant PR move, they rebranded themselves “private equity” in the late 1990’s and went back to the trough this decade claiming they had seen the error of their ways. The news media, unfortunately went along with this transparent PR move.

To his credit, Berman points out the wolf-in-lamb’s-clothing trick:

… it has been spending the last two decades trying to reform its image from the 1980s, when buyout artists were branded unrepentant “flippers and strippers.”

And he says the real economic effects of the LBO looters are becoming apparent, with heavy layoffs in the offing:

Otherwise-decent companies are being subsumed by debts that simply can’t be paid in this brutal recession…

Private-equity research firm Pitchbook Data estimates 7.8 million people are employed by companies owned by private-equity firms.

Berman points to Harrah’s, bought in 2007 by TPG and Apollo, who Berman says hung a $20 billion debt albatross around the casino company, though other reports have put the number at $11 billion. That debt is strangling a company that otherwise would be much better off if it had never heard of TPG or Apollo.

There is little doubt that Harrah’s would have cut back even without that debt load. Other, less-levered casinos are doing the same. The question for the private-equity industry is just how many incremental jobs were cut because of that incremental debt. In other words, how many jobs were destroyed that didn’t have to be?

Harvard Business School’s Joshua Lerner has done a lot of research on these questions, some of it commissioned by the World Economic Forum. He says that such layoffs “would be less severe than what we might initially anticipate,” but added that they were likely to be “more severe than what we saw during the early 1990s.”

One difference is that credit market turmoil is starving troubled companies of the capital they need to emerge from bankruptcy protection. That means that many private-equity backed companies may simply disappear in liquidation.

We need to keep the spotlight on this issue and on these folks.

And an extra bonus to Berman for quoting a union guy in a story on high finance—something you almost never see in the mainstream business media, which almost exclusively quotes businesspeople and their hangers-on, like analysts, investors, and consultants. This is a good way for the business press to get outside the bubble.

Good work.

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.