Congress Might Finally Do Something About Their Own Stock Trades
After years of attempts, a new bill has backing from both parties and a key committee chair.
by Yaseen al-Sheikh, More Perfect Union
A bipartisan group of senators led by Sen. Jeff Merkley (D-OR) unveiled a new proposal on Tuesday morning that would ban members of Congress, along with the President and Vice President, from buying and selling stocks and other assets while in office.
The proposal comes after years of increased attention on congressional stock trades. Nearly a hundred members of Congress between 2019 and 2021 or their close relatives made trades in industries impacted by their legislative committee work, a New York Times investigation found. Some investors even copy the stock trades of politicians who are highly successful in the market, including former Speaker Nancy Pelosi.
“We must be here to serve the public, not our portfolios,” Merkley said during a Wednesday press conference, pointing out that members of Congress made more than 11,000 trades last year worth $1 billion in stock.
An overwhelming majority of Americans, more than 85%, support a ban on Congressional stock trading, according to a University of Maryland poll that was released in June of last year. But despite the idea enjoying such popular support, it has stalled in Congress for several years.
“There is no reason why members of Congress ought to be profiting off of information that only they get,” Sen. Josh Hawley (R-MO) said Wednesday. “The only people who don't seem to understand why stock trading should be banned are here in the Capitol. Every American gets it."
The new proposal would amend the STOCK Act passed in 2012, which requires financial disclosure forms to be filled out by members of Congress and fines them if they fail to comply.
The new bill would ban both members of Congress as well as the President and Vice President from buying and selling securities, commodities, futures, and other assets, according to a summary of the legislation provided by Merkley’s office. Starting in March of 2027, the bill would also require elected officials and their close family members (spouses and dependent children) to divest their assets. The fine for noncompliance with disclosure requirements would also increase from $200 to $500.
Additional fines, scaled to monthly salary or 10% of the value of the assets in question, would be imposed if an officeholder failed to divest from certain kinds of assets covered by the bill.
The legislation is also co-sponsored by Sen. Jon Ossoff (D-GA), who has led similar efforts since entering the Senate, as well as Sen. Gary Peters (D-MI), who chairs the Senate committee where the bill will come up for a vote later this month. Peters notably violated the STOCK Act himself in 2022, according to Sludge.
The path through the rest of Congress is hairier. Senate Majority Leader Chuck Schumer (D-NY) endorsed the idea in 2022, In the House, a bipartisan group of lawmakers sent a letter to Speaker Mike Johnson (R-LA) and Minority Leader Hakeem Jeffries (D-NY) earlier this week calling for a vote on a congressional stock trading ban, to “ensure that members of Congress are serving the country and their constituents, not their bank accounts.”
Hawley said on Wednesday that he hopes “my counterparts in the House on the Republican side will look at this and say this is something that we need to get behind.”