The blockbuster revelations in Big Peace editor Peter Schweizer’s Throw Them All Out about Congressional insider trading have prompted vigorous calls for reform from various lawmakers. First, Texas governor and presidential candidate Rick Perry spoke out against the now-legal practice in a campaign ad. In the House of Representatives, a bill by Rep. Louise Slaughter (D-NY) to ban Congressional insider trading currently has 118 co-sponsors.
Today, Sen. Scott Brown (R-MA) writes an op-ed to promote the STOCK Act, a bill he has recently sponsored in the Senate to “Stop Trading on Congressional Knowledge.” He explains his support for the legislation is based on Schweizer’s reporting.
From the Boston Herald:
I’ve always thought legislators should live by the same laws that govern everyone else. Unfortunately, that isn’t always the case. Recently a “60 Minutes” expose brought to light a glaring loophole allowing members of Congress to legally profit from trading stocks based on non-public information. It also revealed various ways that members may have used the powers of their office to benefit their personal financial and real estate portfolios. This is wrong.
For example, if a member of Congress on the Armed Services Committee were to learn through connections at the Pentagon that a major defense program was suddenly on the chopping block, then that member could sell his or her stock in the defense contractors affected and score a profit — or avoid losses — when the news breaks. Under current law, the congressman would likely walk away with a fatter investment account. For everyone else, it could mean you go to jail.
Why is it the American people are held to one set of laws, but members of Congress are held to some lesser standard? In response, I introduced the Stop Trading on Congressional Knowledge Act (“STOCK Act”), which gets its first Senate hearing today. It prohibits members and employees of Congress and the executive branch from trading or disclosing any nonpublic information they obtain because of their status and to report any securities transaction in excess of $1,000 within 90 days.
Lawmakers often have inside knowledge of laws and regulations as they are being written, before the details are released publicly. They receive classified briefings on issues such as the financial stress on the banking system in Europe. They may sit on committees that can steer taxpayer money not just to their home districts, but to specific projects that could benefit their own real estate holdings.
In his new book, “Throw Them All Out,” Peter Schweizer, a fellow at the Hoover Institute, reports that members of Congress are making a killing in real estate by approving the use of federal funds for projects that enhance the value of properties they own.
Read the full story here.