A group of 27 House members wrote Monday to Nancy Pelosi (D.California), and Kevin McCarthy (R.California), urging them to pass legislation to prohibit Congress from trading stocks.
The letter calls such a ban a “common-sense” move that has the support of both Democrats and Republicans in the chamber. “Both of you have recently addressed this issue in public comments, but this glaring problem will not go away until it is fixed and Congress should not delay when we have the power to fix it,” the letter read.
The effort has rare bipartisan support. It has 25 Democrats and 2 Republicans. signing onPlease read the entire letter. This includes progressives such as Representatives Rashida Tlaib, Katie Porter (D–California), and Pramila Jayapal. Also, Rep. Matt Gaetz (R–Florida).
Lawmakers stated that any legislation, regardless of whether it was written by Democrats or Republicans can be brought before the floor as long as it is done quickly. They cite Sen. Jon Ossoff’s (D-Georgia) Ban Conflicted Stock Trading Act or Representatives Abigail Spanberger (D-Virginia) and Rep. Chip Roy’s (R-Texas) TRUST in Congress Act that were both introduced recently as bills that could be brought to a vote soon.
Both bills would ban members of Congress and their spouses from trading stocks while in office. Portfolios would need to be placed in a blind trust, except for certain investments such as U.S. Treasury bonds or diversified mutual funds.
Pelosi’s letter is the subject of the letter. A slight heel turnLast week, the speaker addressed the issue. While she doesn’t “buy into” the issue, she said, the speaker said that she would be open to supporting her caucus if members are in favor of the ban. The Speaker had previously sparked ire when she defended members’ ability to trade stocks, saying that they should be able to participate in the “free market economy.”
McCarthy, who would likely take the House speaker’s seat if Republicans gain control of it in the midterm election, is also likely. voiced his support for the issueThis month.
As the letter points out, Congress members’ ability to trade stocks is eroding public trust and leads to corruption. Although it is technically illegal for lawmakers not to use non-public information to trade stocks it can be difficult or impossible to determine the cause of certain stock trades.
“The law prohibits only those stock trades that members of Congress make or direct because of their nonpublic knowledge,” the lawmakers wrote, referring to a 2020 stock trading scandal involving several senators making trades after receiving confidential information on the pandemic’s economic effects. “But it can be nearly impossible to determine what counts as ‘nonpublic knowledge’ or how personally involved members are in their stock trades.”
Stock trading disclosures are also a common area where lawmakers break the law. The 2012 STOCK Act instituted disclosure requirements to increase transparency of Congress members’ stock trades.
But since the penalty for failing to disclose trades on time is small – often just a $200 fine – lawmakers and their staffers have little incentive to report their trades, even when they represent clear conflicts of interest. An investigation last yearBy InsiderIt was found that at most 54 members of Congress had violated the STOCK Act. Many late disclosures were worth more than a million dollars.
The letter writers claimed that the legality of these actions is not relevant. However, they stated that the ability to trade stocks distracts legislators from their duty to protect and serve constituents. “Perhaps this means some of our colleagues will miss out on lucrative investment opportunities. We don’t care,” they wrote. “We came to Congress to serve our country, not turn a quick buck.”
Polling has found that the public also agrees that Congress shouldn’t be allowed to trade stocks. A Recent Data for Progress pollWhen presented with arguments in support or against the proposal, 74% of likely voters supported it. This includes 76% of Democrats, 76% of independents, and 70% of Republicans.