It seems that the major sticking point in the debt-ceiling debates in Washington centers around the nation’s wealthiest Americans (corporations, oil companies, etc) paying taxes on some of their enormous incomes. The Democrats say they should be required to pay their fair share. Democrats say no. It doesn’t matter if the country defaults on its debts and the country goes into a nose-dive, wealthy folks shouldn’t have to pay anything. Instead, let the middle-class and our senior citizens pick up the tab. After all, they’re not as important as, say, banks.
And when it comes to opposing those taxes, no man is more vocal or carries a bigger stick than Majority Leader Eric Cantor (R-Va). You may recall that it was Rep. Cantor who abruptly stalked out of talks with Vice President Joe Biden when the White House had the audacity to suggest that any debt-reduction plan include revenue, and couldn’t just be based on cuts.
And while we’re recalling, we might recall that it was Cantor who threw a monkey-wrench into the initial stages of efforts by President Obama and Speaker Boehner to formulate their “grand bargain.” He didn’t think it was so grand, or that it was a bargain. He would have nothing to do with it.
This isn’t something new for the congressman. He’s been fighting changes in the tax codes at least for the past four years, maybe longer.
In a Monday column in The Washington Post, he is described as the embodiment of the Tea Party and business interests.
In 2007 it was Cantor who charged to the forefront when Democrats first proposed two major changes to the tax code. He argued that changing the tax treatment of carried interest would “raise taxes on innovation and opportunity in America” and do harm to “mom and pop” businesses.
In responding to those charges, Rep. Sander Levin (D-Mich) said, “There’s virtually no evidence that having these people pay ordinary income would inhibit business development. This is not an issue relating to mom and pop operations.”
Says Rep. Chris Van Hollen (D-Md), “This (anti-tax stance) isn’t all coming from the grass roots. This goes to some longtime cozy relationships between House Republicans and hedge fund managers in the financial sector.”
That isn’t just speculation on Rep. Van Hollen’s part. It is well documented.
The Washington Post reports that Cantor was one of the top recipients of contributions from private equity firms and real estate conglomerates. In 2010 his two fund-raising committees received around $2 million from securities, real estate companies and real estate firms.
Hedge funds and private equity firms have increased their lobbying efforts over the last few months and is undoubtedly one reason why there is a stalemate now between the Republicans and the Democrats as they attempt to find a solution to the debt-ceiling fiasco before it’s too late.
One lobbyist is quoted in the Post article (on condition of anonymity) that it has been highly beneficial to have Cantor as a lead negotiator in the talks.
Highly beneficial for them, perhaps, but an unmitigated disaster for the rest of us.