Before any of that can happen, however, the House needs to vote on its version, which could happen as early as this week. The House’s version of the bill, however, is shaping up to be considerably different than the Senate’s.

House Majority Leader Eric Cantor (R-VA) has made several changes to the legislation which appear intended to at least weaken the final product, if not to kill it outright. The government watchdog group Citizens for Responsibility and Ethics in Washington (CREW) laid out some of those changes:

CREW strongly supported the Senate approved version of the STOCK Act (S. 2038) passed by an overwhelming bipartisan vote of 96 to 3. S. 2038 goes well beyond merely prohibiting insider trading by, among other things, requiring registration by political intelligence consultants, stripping pension benefits from corrupt members of Congress and closing serious loopholes in the nation’s anti-corruption laws.

The bill Rep. Cantor is bringing to the floor removes several of these provisions. Although the House Judiciary Committee passed nearly identical legislation late last year, the new bill drops the Leahy-Cornyn amendment, which responds to court decisions that have undermined prosecutors’ efforts to target public corruption. It also excludes the Grassley Amendment, which would require political intelligence consultants to register with Congress.

Cantor had also tried to expand the legislation to ban other transactions, such as land deals. As UCLA law professor Stephen Bainbridge noted, “Cantor obviously hopes that including a vast array of economic activity within the bill, exposing members of Congress to disclosure obligations and other restrictions, as well as increasing their liability exposure, will make the bill sufficiently unpopular so as to prevent its passage.”

Despite Cantor’s public protestations that “it is unacceptable for anybody in this body to profit personally from non-public information,” his changes to the STOCK Act have unnecessarily made it weaker. As Rep. Louise Slaughter (D-NY), a chief sponsor of the bill, put it, “I think strengthening here is a euphemism for weakening.” It is also worth noting that, when Bachus proposed an insider trading bill to help repair his image, Cantor blocked it from going forward.

If the House passes a different piece of legislation than the Senate, they will need to be reconciled before they can be signed into law. As the statement from CREW notes, the sections which Cantor removed could still be added back to the final bill in conference, which is why they are still calling for members to vote for passage.

– Zachary Bernstein

The Senate, in a rare display of bipartisanship, opened debate on an insider trading ban by a vote of 93-2. However, the bill has since become bogged down under a sea of unrelated amendments.

Over in the House, meanwhile, House Majority Leader Eric Cantor (R-VA) — who reportedly blocked Bachus from bringing up a ban on congressional insider trading in committee — wants to expand the legislation to include bans on other sorts of transactions, such as land deals. UCLA Law Prof. Stephen Bainbridge notes that this is likely an attempt by Cantor to kill the bill by making it so overly broad that no one will vote for it:

[Cantor's] now trying to extend the STOCK Act “so it includes land deals and other types of transactions and not just stock trades.” Classic taking a good idea too far. The problem is insider trading in stocks, not insider trading in land deals. Cantor obviously hopes that including a vast array of economic activity within the bill, exposing members of Congress to disclosure obligations and other restrictions, as well as increasing their liability exposure, will make the bill sufficiently unpopular so as to prevent its passage.

The Stop Trading on Congressional Knowledge (STOCK) Act has picked up 273 co-sponsors, after languishing for months with nearly no interest.

STAHL: What’s the difference between compromise and cooperate?

CANTOR: Well, I would say cooperate is let’s look to where we can move things forward where we agree. Comprising principles, you don’t want to ask anybody to do that. That’s who they are as their core being.

STAHL: But you know, your idol, as I’ve read anyway, was Ronald Reagan. And he compromised.

CANTOR: He never compromised his principles.

STAHL: Well, he raised taxes and it was one of his principles not to raise taxes.

CANTOR: Well, he– he also cut taxes.

STAHL: But he did compromise–

CANTOR: Well I –

DAYSPRING: That just isn’t true. And I don’t want to let that stand.

Watch it:

Dayspring has had some trouble with the facts regarding taxes before, but the notion that it “just isn’t true” that Reagan raised taxes is absurd. He raised taxes in seven of his eight years in office, including one stretch of four tax increases in just two years. As Paul Krugman put it, “no peacetime president has raised taxes so much on so many people.” Reagan also completely equalized the tax treatment of investment income with that of wage income, a position putting him to the left of many of today’s Democrats, never mind Republicans.

Cantor’s office tried to clarify later that Dayspring’s remark “referred to the cumulative effect of Mr. Reagan’s tax policies, pointing out that he cut taxes more than he raised them, and that Mr. Reagan expressed regret making tax deals with Democrats because the spending cuts they agreed to never materialized.” But the point is, as historian Douglas Brinkley put it, “Ronald Reagan was never afraid to raise taxes. He knew that it was necessary at times. And so there’s a false mythology out there about Reagan as this conservative president who came in and just cut taxes and trimmed federal spending in a dramatic way. It didn’t happen that way. It’s false.” And this is a truth that today’s GOP just hasn’t been able to handle.

Eric Cantor (right) and his ideological muse Newt Gingrich (right)

Earlier this year, House Majority Leader Eric Cantor (R-VA) made a series of major missteps when he decided the House GOP would not release federal disaster funds unless it included offsetting spending cuts following a deadly Missouri tornado, a hurricane that hit the east coast, and an earthquake in Virginia.

Though Cantor was roundly criticized for the move, a look back to the 104th Congress revealed the origins of Cantor’s idea: Newt Gingrich.

Less than two months after Gingrich took over as House speaker in 1995, one of his first orders of business was to propose holding off on federal disaster aid unless it was accompanied by spending cuts elsewhere in the budget. Gingrich downplayed the long-held system of sending federal relief money to areas stricken by natural disaster without making it contingent on ideologically-driven cuts, telling reporters, “you don’t have this thing of waving a magic wand and saying, ‘Well, this is an emergency.’”

This was not simply a theoretical exercise. When the 1995 Oklahoma City bombing occurred later that year, Gingrich held federal disaster aid hostage unless he received offsetting spending cuts, prompting the Philadelphia Daily News to write that “Even Newt Gingrich must lose a little sleep at the idea of making political hay out of the mini-civil war that struck Oklahoma City.”

The Free Lance-Star from February 11, 1995, has more:

President Clinton last week asked Congress for an extra $4.9 billion in emergency aid to pay for repairs lingering from the Northridge earthquake in Southern California a year ago. He also is seeking an additional $500,000 to repair damage from last month’s record flooding in the state.

Typically, those funds are sent to states under special budget rules that do not require Congress to earmark offsetting cuts.

But that practice, Gingrich said, is about to change.

“We’re going to have to find a way to offset that,” he said.

Gingrich went on to criticize President Clinton for refusing “to suggest where to cut to pay for federal disaster aid.” Not all congressional spending proposals were held to this same standard though. As the Washington Post wrote in July 1996, Gingrich “instructed a House Appropriations panel to earmark an additional $15 million for water projects to boost reelection prospects of Republicans in California, Illinois, New Jersey and Washington state.”

Pork-barrel projects like these were deemed important enough to merit a special earmark, but Gingrich held disaster relief money hostage unless Congress and the president agreed to offsetting spending cuts elsewhere. Sixteen years later, Cantor took up the mantle and used the devastating Joplin tornado, which killed 159 people, to try to extract spending cuts from congressional Democrats.

House Financial Services Committee Chairman Spencer Bachus (R-AL)

Last month, a 60 Minutes investigation revealed that House Financial Services Chairman Spencer Bachus (R-AL) made stock trades based on information that he received in private briefings during the financial crisis of 2008. Bachus’ trades reportedly netted him around $30,000.

Following the story, Congress suddenly found an interest in blocking its members from trading on information they receive in their official capacity. The Stop Trading on Congressional Knowledge (STOCK) Act, which would ban this sort of activity, picked up dozens of co-sponsors, after it had languished for months with nearly no interest. Bachus was evidently ready and willing to move the bill forward, in an attempt to clean up his own image, but several other Republicans, including House Majority Leader Eric Cantor (R-VA), put the kibosh on that plan, according to Politico:

A day after Financial Services Committee Chairman Spencer Bachus said he would move forward on an insider-trading bill, Majority Leader Eric Cantor stopped him dead in his tracks.

In a Wednesday meeting described by one source as “extremely direct” and by another as “very blunt,” Cantor (R-Va.) ripped into Bachus, explaining in no uncertain terms that it was unacceptable for Bachus to mark up the bill without having run it by GOP leaders and other chairmen with jurisdiction over its provisions. The Alabama Republican abruptly canceled the vote, which was scheduled for next week. [...]

“We’re not going to cover Spencer’s ass by passing a half-baked bill,” one Republican member of the panel told POLITICO. “Even Barney Frank didn’t pass it in his two terms as chairman and Dem[ocrats] are the lead sponsors. It’s all about Spencer’s bad political position, not the contents of the policy.”

“The public has an absolute right to demand that the people they elect to represent them in Congress conduct themselves according to the highest ethical standards and do not seek to profit from their positions,” Bachus said while announcing his intention to move the legislation forward. However, it seems that his leadership doesn’t quite see things that way.

“I could absolutely work with her,” Cantor told me in an interview this morning. “She would be a real benefit for patients. Obviously she’s operating within a context, within the structure of a law that I didn’t support, but I do think she will bring to the job a perspective of the American health care system that has made it so great, a system that’s based on the private sector.”

Most health care providers work in the private sector, but it’s hard to argue that the American health care system is “based in the private sector” when the government finances almost half of national health care spending.

For instance, in 2010, growth in private health insurance premiums remained low, as 5.1 million enrollees lost their jobs or simply couldn’t afford to maintain their coverage. Many enrolled in safety-net health care programs like Medicaid, resulting in a spending increase of 7.2 percent. By 2014, private growth is projected to accelerate — thanks to health care reform — but even then, “private health insurance is anticipated to account for roughly 31 percent of national health spending, or about the same share as was expected without enactment of the Affordable Care Act,” actuaries at CMS estimate. “For 2011–13, government outlays (averaging 5.2 percent growth) are projected to roughly maintain a 45-percent share of total health spending.”

So in truth, ours is a hybrid public/private health care system, but if lawmakers like Cantor succeed in vouchering Medicare, block granting Medicaid and repealing the Affordable Care Act, then their mythology may become reality.

Cantor disputed the claim, saying, “your direct question, allegation, I don’t know is accurate,” before launching into a non-answer about how the real issue is not the grants but the increasing cost of higher education. Watch it:

In fact, since coming to power, the House Republican majority — led by Cantor — has repeatedly set its sights on Pell Grants. Republican lawmakers have not only proposed lowering the maximum Pell amount from $5,500 (which is the level to which the Obama administration raised it) but also limiting eligibility, knocking one million students from the Pell program entirely. Republicans claim “we don’t have the money” to afford the grants, but the same House GOP budget that made cuts to Pell — for which Cantor voted — provides huge tax breaks for the wealthy and corporations that dwarf the cost of preserving the grants.

It’s also worth nothing that it was Cantor himself who, during July budget talks with the White House, proposed a cut “aimed squarely at college students” that would make students stat paying interest on their federal loans right away, instead of deferring until after graduation.

At a time when student loan debt is hitting new heights and joblessness is above 9 percent, Cantor’s response to a student genuinely concerned about financing his higher education is quite telling, especially when the GOP leader claims to agree that “the investment on higher education has an infinite return.”

Some audience members booed the Virginia Republican and shouted, “what about liberty?” and “none of your business!” One man engaged directly with Cantor:

AUDIENCE MEMBER: I’m gay, you’re not for my family, am I in your bedroom?

CANTOR: Well, I would again say that, we all no matter what we are — who we are, what the background of this country, should allow for equal opportunity to earn the success that we’re after.

The audience pressed, “answer the question,” but Cantor just moved on. Watch it:

Several Occupy Wall Street advocates also protested Cantor’s speech by turning standing up and turning their backs to the podium as he spoke. Several wore LGBT-equality T-Shirts.

Cantor eventually softened his rhetoric, and even scheduled a talk about income inequality (that he proceeded to cancel when he realized that the public would be allowed to attend). But Cantor has plenty of reasons to bash the protests because, as Roll Call noted today, Cantor’s top contributor this year is Wall Street:

Cantor’s personal political action committee has collected close to $2 million so far this year, placing it well ahead of any other leadership PAC in the House or Senate. In all of his fundraising efforts, top executives at banks, hedge funds and securities and investment firms play a starring role. Securities and investment industry donors have given close to $350,000 to both Cantor’s campaign and his leadership PAC this year, making them his top source of donations, according to the Center for Responsive Politics.

But Cantor has raised millions more than that for a lucrative operation known as the Cantor Victory Fund 2012…Ten major donors, many of them top executives with finance industry firms, have given $50,000 or more this year to the Cantor Victory Fund, which has collected $2.4 million, according to the most recent public disclosures.

Cantor has pushed several policies near and dear to Wall Street’s heart, including protecting tax loopholes for hedge fund managers, while managing to come up with no ideas for addressing income inequality. In fact, he believes we should just depend on the wealthy to bring down inequality through the goodness of their hearts. And so far, Wall Street has certainly shown its appreciation for Cantor’s positions.

My grandmother eventually made her home in a working class section of my hometown of Richmond. As you can imagine, in the early 20th century, the South wasn’t often the most accepting place for a young Jewish woman. Widowed by age 30, she raised my father and uncle in a tight apartment above a tiny grocery store that she and my grandfather had opened. She worked day and night and sacrificed tremendously to secure a better future for her sons. And sure enough, this young woman – who had the courage to journey to a distant land with hope as her only possession – lifted herself into the ranks of the middle class. Through hard work, her faith and thrift, she was even able to send her two sons to college. All she wanted was a chance – a fair shot at making a better life for her two sons. And if she were still alive today, I know she would be blown away to know that her grandson is not only a Member of the U.S. Congress, but now the Majority Leader of the U.S. House of Representatives.

Who cares? I mean, good for his grandmother but what does this have to do with anything? Is a modern-day working mother hoping to put her kids through college supposed to hope that the relative price of tuition suddenly falls to 1950s levels? What insights has this second-hand experience of poverty given Cantor that others lack? It’s easy to understand why first-hand experience might give you a different perspective. But what Cantor seems to have learned from his grandmothers’ efforts is that high end marginal income tax rates need to be made much lower than they were at the time she was pulling herself up by her bootstraps.

Income inequality in the country is currently as high as it’s been since the Great Depression. The richest 1 percent of Americans make nearly one quarter of the national income, and the 400 richest Americans have more wealth than the bottom 50 percent combined. Since 1979, “the gaps in after-tax income between the richest 1 percent of Americans and the middle and poorest fifths of the country more than tripled.” And the trends are only getting worse.

With all that to grapple with, Cantor’s speech quite literally has no policy proposals in it at all. In fact, the closest he comes to presenting an actual idea is a plea not to say mean things about rich people or ask them to pay their fair share in taxes:

There are politicians and others who want to demonize people that have earned success in certain sectors of our society. They claim that these people have now made enough, and haven’t paid their fair share. But, pitting Americans against one another tends to deflate the aspirational spirit of our people and fade the American dream. I believe that the most successful among us are positioned to use their talents to help grow our economy and give everyone a hand up the ladder and the dignity of a job. We should encourage them to extend their creativity and generosity to helping build the community infrastructure that provides a hand up and a fair shot to those less fortunate. [...]

Instead of talking about a fair share or spending time trying to push those at the top down, elected leaders in Washington should be trying to ensure that everyone has a fair shot and the opportunity to earn success up the ladder. The goal shouldn’t be for everyone to meet in the middle of the ladder. We should want all people to be moving up and no one to be pulled down. How do we do that? It cannot simply be about wealth redistribution. You don’t just take from the guy at the top to give to the guy at the bottom and expect our problems to be solved.

Cantor also mentions that lawmakers should embrace “a Steve Jobs Plan,” under which “those who are successful not only create good jobs and services that make our lives better, they also give back and help everyone move just a little bit further up the ladder and everybody wins.” But that’s it. No actual ideas of any kind. Cantor’s entire speech is a story about his grandmother and a plea to not raise taxes on the wealthy.

Last weekend, Cantor said on Fox News that the proper way to address income inequality is to simply rely on the already wealthy. Anyone hoping that his speech today would provide some concrete policy proposals would have been left disappointed, if he had actually delivered it. Just in case Cantor wants to try it again sometime, here are some actual ideas for reducing income inequality.

“The Office of the Majority Leader was informed last night by Capitol Police that the University of Pennsylvania was unable to ensure that the attendance policy previously agreed to could be met,” wrote Cantor spokeswoman Laena Fallon. “Wharton is a educational leader in innovation and entrepreneurship, and the Majority Leader appreciated the invitation to speak with the students, faculty, alumni, and other members of the UPENN community.”

In a statement just released by the university, the school disputes Cantor’s explanation, saying the speech was always billed as “open to the general public”:

Wharton deeply regrets that the event scheduled at the School this afternoon with Majority Leader Eric Cantor has been cancelled. The University community was looking forward to hearing Majority Leader Cantor’s comments on important public issues, and we hope there will be another opportunity for him to speak on campus.
 
The Wharton speaker series is typically open to the general public, and that is how the event with Majority Leader Cantor was billed. We very much regret if there was any misunderstanding with the Majority Leader’s office on the staging of his presentation.   

Cantor’s decision followed plans for a large march and protest prior to the speech, with participation by Occupy Philadelphia and other groups. Cantor has previously dismissed the Occupy Wall Street movement as a “mob.”

You can read the full text of the speech that Cantor did not deliver HERE.

As CAP’s David Madland and Nick Bunker show in the following chart, the middle class’s share of national income has steadily declined as the percentage of the population in labor unions has fallen. At the same time, the top 1 percent’s share of national income has exploded:

Strong unions have traditionally been the free-market solution to income inequality, allowing people to get higher salaries without government intervention. Unionization has allowed middle class and working-class Americans to have the ability to bargain for stronger wages and benefits and a larger share of national income. Highly-unionized countries tend to have far less income inequality.

Sweden, where 85-90 percent of the population is unionized, is both a prosperous country and one of the most economically equal societies — and that’s in a nation that doesn’t even have a national minimum wage.

If Cantor really wants to address income inequality, he could endorse legislation similar to the Employee Free Choice Act, which would break down barriers that have been erected to American union membership.

Currently, his two major ideas center on relying on the wealthy and “mak[ing] sure the people at the the top stay there.” But in case he’s legitimately considering the issue, we’d like to be helpful and offer five tangible ways Cantor and Congress could effectively address income disparity:

1. Promote Unionization: Unions are a key building block of a strong middle-class, ensuring fair wages and treatment of working families. Research shows that today’s union workers make about $2.50 more per hour than their non-union counterparts. However, union membership has seen a sharp decline in membership over the past forty years, matched by an significant drop in the middle class’s share of the nation’s income, while America’s wealthy take their largest share of national income in over 80 years. If unionization rates were just 10 percent higher, the Center for American Progress found that a “typical middle class household would earn $1,479 more every year.” Cantor’s home state of Virginia’s unionization rate currently stands at 4.7 percent. If it was 10 percent, Virginia’s middle class families would gain over $3 billion in income.

2. Rein in CEO Pay: Executive pay continues to greatly outpace worker’s wages, with CEOs at America’s largest companies earning 343 times more than the typical worker. Indeed, “the largest single chunk of the highest-income earners, it turns out, are executives and other managers in firms.” And while executive pay has “more than quadrupled” since the 1970s, pay for a typical worker “has dropped more than 10 percent” over the same period. 90 percent of major U.S. companies “expressly set their executive pay targets at or above the median pay,” which for “top executives” stands at about $4.9 million.

3. Fair, Progressive Tax Reform: Preferential tax treatment for America’s wealthy is a driving force behind income inequality. The Bush tax cuts that Republicans continually fight for increased the economic divide “by delivering more than half of their benefits in 2010 to the top 10 percent of earners, who make over $170,000 a year.” In fact, 25 percent of millionaires in the U.S. pay a lower effective tax rate than 10.4 million middle-class Americans because of favorable tax treatment. Overall, the working poor are actually paying a higher percentage of their income in state and local taxes than the wealthy in 49 states. If Cantor would champion progressive tax policies like the Buffett rule, it would put every taxpayer on a more equal footing and help to alleviate the income disparity.

4. Increase the Capital Gains Tax Rate: As TP Economy editor Pat Garofalo notes, capital gains (including stock, bonds, and real estate profits) “are almost exclusively made by the very wealthy and are taxed at lower rates than wages and salaries,” which serves to drive income inequality. Over the past 20 years, more than 80 percent of capital gains income in the U.S. has gone to the top 5 percent. Because the capital gains tax is capped at 15 percent, “anyone making more than $34,500 a year in wages and salary is taxed at a higher rate than a billionaire is taxed on untold millions in capital gains.” If Cantor — who currently champions reducing this tax rate — really wants to address the disparity, he’ll reconsider this position.

5. Promote Economic Mobility Through Education: Economic mobility is a bedrock principle of American society. But a recent report found that Americans face widespread “downward mobility,” with one in three middle-class Americans slipping down the income ladder. This trend, along with general income inequality, stifles economic growth which, in turn, hampers mobility. As the Brookings Institute notes, promoting education is a vital way to “boost the mobility of children from poor and low-income families.” Cantor — who voted against bolstering Pell Grants, reducing student loan payment rates, and believes preventing teacher layoffs is not a priority — may ignore this as well.

Most of these policies would require Cantor to reject the entire portfolio of GOP talking points and thus are unlikely to make it into his speech. However, if he is serious about finding a solution for income disparity, he should start by recognizing the problems behind it.