LaRouche: 'The Hedge Funds Have Bought the Senate'
December 7, 2007 (LPAC)--Lyndon LaRouche stated today that yesterday's defeat in the U.S. Senate of the bill authored by House Ways and Means Chairman Charles Rangel (D-NY) to pay for indexing the alternative minimum tax for inflation by taxing hedge funds was bought and paid for by the hedge funds. LaRouche said, "This is corruption. Members of the Congress are so much into having their campaigns funded, that they voted against the interests of the nation. The hedge funds bought the Congress."
The fact that the hedge funds were totally mobilized to defeat Rangel's bill in the Senate is unmistakable. The Washington Post reported on December 5 that according to the Center for Responsive Politics, in the first nine months of this year hedge funds and investments firms donated $11.7 million to federal candidates and party committees. That is $1.6 million more than they contributed in all of 2005 and 2006. The firms also spent $8 million on registered lobbyists in the first six months of this year, compared with $3.7 million for all of 2006.
When the issue came to the floor of the Senate yesterday, the Republicans succeeded in blocking a vote on the House bill. At that point, by a vote of 88-5, the Senate approved a one-year stop-gap measure that temporarily indexes the alternative minimum tax (AMT) for inflation, sparing 23 million American households from an average tax increase of $2000 this year, which was originally designed to target only the super-rich. But in the process, the Senate Democrats dropped the provisions in the House version to link the indexing of the AMT for inflation to a $54 billion tax increase on super-rich executives at private equity firms and hedge funds. To make the capitulation complete, Senate majority Leader Harry Reid, obviously in coordination with Speaker of the House Nancy Pelosi, said House Democrats would accept the Senate action.
The problem with the House bill from the beginning was that under orders from Nancy Pelosi, the justified increase in the taxes on hedge funds and other speculators, was tied to the AMT patch, on the grounds that the lost tax revenue from the AMT patch should be offset based on the false argument of "pay as you go." Tying the two issues together in this way effectively sabotaged the tax on the hedge funds. Once again Nancy Pelosi did the bidding of Felix Rohatyn and his hedge fund friends.
(See: Flash: Nancy Pelosi in Closed Door Session with Fascist Felix Rohatyn; Continues to Block Action on HBPA)
After the Senate vote, Rep. Rangel issued a statement saying he would try to alter the Senate measure to close a tax loophole that allows hedge fund managers to defer taxes on money in offshore accounts. "The House will consider these amendments so that we may give the Senate another chance to do the right thing and pass responsible AMT relief," Rangel said. On the other hand, Rangel said yesterday he wouldn't oppose removing a provision that would boost the tax on so-called carried interest, the performance fees that managers of private equity firms, hedge funds and some real estate and oil and gas partnerships earn.
As Lyndon LaRouche stated, "Nancy Pelosi has demonstrated that she is totally bought by the most evil fascist elements of international finance."