Wednesday, July 27, 2011

Who Does House Majority Leader Eric Cantor Represent? The Richmond Suburbs or Private Equity Firms and Hedge Fund Managers

Do You Really Have to Ask?

In an in-depth story on House Majority Leader Eric Cantor (R, Va) the Washington Post Headline reads

In Cantor, hedge funds and private equity firms have voice at debt ceiling negotiations

Mr. Cantor is the House Majority Leader for the Republican Party.  In the deficit/debt ceiling talks he has been the most adamant about not raising taxes on wealthy taxpayers.

His interest in that particular aspect of the policy may well be explained by this

Among the White House’s top demands for new revenue are changes in the tax code affecting hedge funds, private equity firms and real estate partnerships, which would raise an estimated $20 billion over 10 years.

Mr. Cantor

For the past four years, Cantor has taken the lead in the House on fighting the same changes. He also has been one of the top recipients of contributions from those industries — last year, his two fundraising committees received nearly $2 million from securities and investment firms and real estate companies, more than double the figure for Boehner (R-Ohio).

Now Mr. Cantor is not the first member of the Congressional leadership to accept massive donations from wealthy special interest groups, and the practice is not restricted to Republicans as many Democrats (including Mr. Obama) have also taken huge donations from Wall Street and its minions.  That is not the point.

The point is that while the voice of the very wealthy are more than adequately represented in the budget talks, the voices of working men and women and the voices of those unable to work, the elderly, the sick, the disabled, the young do not seem to be represented. 

Supposedly their positions were the positions of the Democrats and Mr. Obama.  Yet it is clear that the only agreement on deficit reduction that they will fight for contains massive (and as yet unidentified) cuts on spending for social programs, Medicare, Medicaid and possibly Social Security.  There is no new revenues to offset some of the cuts.  They have given up the fight to reduce some of those cuts by increasing taxes on the very wealthy. 

So no one is representing the Democratic Wing of the Democratic Party.  When no one is speaking for you at the bargaining table, you lose. 

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