House Minority Leader Eric Cantor made it known today that tax loopholes would now be allowed consideration in the debt ceiling negotiations. According to the Associated Press, the statement was a break from his former position that they only be considered in an exhaustive overhaul of the tax code. It is a slight break in what has become a deeply entrenched partisan-specific debate. But Rep. Cantor has a problem with conflict of interest with regard to the negotiations, something that was made public a week ago. So why hasn’t he recused himself not only from the negotiations but from having anything to do with the debt ceiling talks and/or its subsequent vote?
Last week, Salon.com ran an article revealing that Rep. Cantor had up to about a $15,000 investment in ProShares Trust Ultrashort 20+ Year Treasury EFT, a fund that deals in “shorting” U.S. Treasury bonds. To explain: a “short” increases in worth when something fails. In this case: U.S. Treasury bonds. If the debt ceiling is not raised and the United States defaults on its loans, treasury bonds are likely to see increased market volatility and an assured drop in worth. If that were to happen, Cantor stands to make a lot of money on his investment.
Yet, the congressman is in negotiations with Vice President Joe Biden and others in what is supposed to be attempts at resolving the debt ceiling issue and keeping the government from shutting down, which could occur should a compromise not be reached by Aug. 2, the last day Treasury Secretary Timothy Geithner maintains he can keep juggling the government’s bills in order to keep it running smoothly without defaulting on at least some of its debts.
You read that right. Eric Cantor will personally profit if we default on the debt ceiling. I had written some weeks ago that I thought this whole debate was nothing more than kabuki theater, because ultimately, the GOP would not go against their Wall Street masters and destroy the full faith and credit of the country. But when your lead negotiator is lining up side bets that we will, in fact, fail, then you have to wonder where his loyalties lie and whether any negotiations coming from the Republican could be considered “in good faith”.
With the news that Boehner has canceled his scheduled meeting this morning with Obama because the White House will not absolutely take tax hikes off the table, I’d say it’s time for the White House to separate distinctly and definitively the discussions of the debt ceiling and the deficit and tell Congress to vote to raise the debt ceiling without delay.
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