Wednesday, 29 June 2016
Last updated 11 hours ago
Jun 11 2014 | 9:31am ET
The defeat of the second-ranking Republican in the U.S. House of Representatives has shocked pundits writing obituaries for immigration reform and rescinding those for the Tea Party. But the shockwaves from House Majority Leader Eric Cantor’s primary loss yesterday are likely to be felt on Wall Street, as well.
In a major upset that almost no one—least of all Cantor or his colleagues—saw coming, the majority leader, second only to Speaker of the House John Boehner, was soundly defeated by college professor David Brat in yesterday's Republican primary.
Cantor, who represents the Richmond, Va., area in Congress, has been among the finance industry’s strongest supporters on Capitol Hill. One industry source told Politico that he was “one of the few remaining House Republicans who understood the complicated and nuanced issues facing the financial services community.”
“He had a firm grasp of financial services issues and the impact of those issues on the industry and consumers,” another said.
Cantor has been richly rewarded for that understanding during his 13 years in Congress. Over the past two years, he’s been the biggest recipient of private-equity and investment industry campaign dollars, according to the Center for Responsive Politics. The Blackstone Group, hedge fund Scoggin Capital Management and Goldman Sachs were among the biggest contributors to his re-election efforts.
Cantor’s links to Wall Street did not play a major role in Brat’s campaign. Instead, the economist focused on Cantor’s support for immigration reform and hammered the majority leader for failing to be conservative enough.