Ban lawmakers from trading stocks
After a contentious year, Congress appears to be on the verge of passing bipartisan, commonsense legislation. Even better, the effort in question is popular, prudent and right on the merits.
Last week, House Speaker Nancy Pelosi offered tepid support for legislation that would bar lawmakers from trading individual stocks. Pelosi has long resisted the reform, saying in December that members should be allowed to participate in the “free-market economy” and that current regulation was enough. With a trading ban getting strong backing from the public, she has evidently seen the light.
There’s little doubt legislation of this kind is needed.
Following several stockrelated scandals, Congress passed the Stop Trading On Congressional Knowledge Act in 2012. It was supposed to establish clear disclosure guidelines, curtail perceived conflicts of interest, and prevent lawmakers from trading on nonpublic information acquired during their official duties. It hasn’t worked out as planned.
No lawmaker has ever been successfully prosecuted under the act. Over the past year alone, at least 55 House and Senate members (and nearly 200 staffers) have failed to fully comply with its reporting requirements, according to media reports.
Unlike most issues before Congress, this one isn’t very complicated: No lawmaker should be able to trade individual stocks while in office. The opportunities for abuse are too plentiful, and disclosure requirements alone will never be enough to prevent serious misconduct.