Washington’s New Bipartisan Problem: Prohibiting Lawmakers From Actively Trading Stocks

That’s about the only thing garnering bipartisan support these days in Washington: a ban on stock trading for active members of Congress.

While it’s still unclear if the idea has the majority support it needs to pass, it does have support from both Republican and Democratic sides — along with the senses. Josh Hawley, R-Mo., and Jon Ossoff, D-Ga., announcing competition bills earlier this week to achieve much the same goal: to prevent members of Congress in both houses from taking advantage of their powerful positions. placing their shares in a blind trust and prohibiting any future investment in individual companies.

“Members of Congress should not be playing the stock market while we craft federal policy and have extraordinary access to confidential information,” Ossoff said in a press release. His bill is co-sponsored by Sen. Mark Kelly, D-Arizona, who added that the measure would “end corrupt insider trading.”

House Minority Leader Kevin McCarthy told Punchbowl News this week he was considering pushing the measure if Republicans were to take over Congress in 2022, though it was unclear by what mechanism. McCarthy has previously said he will refrain from trading individual stocks during his tenure.

Not one to be outdone, even Sen. Ted Cruz, R-Texas, is believed to be considering a similar bill.

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And it’s a sentiment that was also echoed on Friday by one of President Joe Biden’s top economic advisers, Brian Deese, who called Hawley and Ossoff’s proposals “reasonable” and something that would “restore confidence in our institutions”.

“I can tell you that the restrictions on [employees in] the executive branch are pretty big,” Deese said during an interview on CNBC’s “Squawk Box.” “There is no commitment on individual stock trades.

“I think [banning Congress from trading individual stocks] certainly makes sense. This is a rule that we all follow and respect in the executive, and [it] imposes no real practical burden on our ability to do our job.”

The dueling bills come only after talks between the two senators’ offices broke down in recent weeks, Axios reported. Hawley previously tweeted that it was a “good idea” when news of Ossoff’s bill broke, and told POLITICO he was willing to co-sponsor the measure. But the Missouri brandon ultimately decided to introduce his own bill, further complicating the issue.

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The difference between the two bills lies in their enforcement mechanisms. Hawley’s, dubbed “Congress’s Insider Trading Prohibition Act,” would make the Government Accountability Office oversee Congressional investments and require lawmakers (or their spouses) to repay all profits to the U.S. Treasury.

Ossoff’s bill, meanwhile, would leave oversight to the congressional ethics committee and charge violators their full pay. This also includes dependent children of members of Congress, which Hawley’s bill does not do.

Calls to curb congressional stock trading have grown in recent months after a slew of headlines about members violating the STOCK ACT, an Obama-era law requiring prompt reporting of any trades, and reports of crimes potential insiders from several members of Congress.

An Insider investigation last year found that at least 52 members of Congress and 182 senior officials violated the STOCK Act, an act with a comical fine for those who break the rules: $200.

Recent reports here at Salon — and elsewhere — have also revealed deals that appear to violate conflicts of interest.

For example, Rep. Pat Fallon, who sold hundreds of thousands of dollars of Microsoft stock just weeks before the company’s $10 billion contract with the Pentagon was canceled. Fallon sits on the House Armed Services Committee’s newly created Cyber, Innovative Technologies and Information Systems Subcommittee, which oversees the deal in question. He is just one of 15 members of Congress from both parties who play a key role in shaping defense policy and who have actively invested in military contractors.

But the idea of ​​barring members of Congress from trading stocks has at least one prominent opponent: House Speaker Nancy Pelosi. She’s also one of the most prolific marketers in Congress, with her husband in recent months gobbling up millions in blue-chip stocks like Google, Disney, Salesforce and Roblox.

The whole situation, critics say, has given Capitol Hill an irreconcilable image problem. Deese alluded to the issue during his interview with CNBC, saying, “There’s a lot of distrust and mistrust around how politics works, around the political process.”

“One of the things we need to do at all levels is to restore trust in our institutions, whether it’s Congress and the legislature, whether it’s the Fed or whatever and so anything we can do to try to restore that confidence, I think makes a lot of sense,” he added.

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Garland K. Long