A push to ban members of Congress from trading individual stocks gains momentum

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A push to ban members of Congress from trading individual stocks gains momentum¹

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Traders work on the floor of the New York Stock Exchange. Lawmakers from both parties are stepping up calls to ban members of Congress from trading individual stocks.

Spencer Platt/Getty Images

Almost 10 years ago, Congress overwhelmingly passed the STOCK Act — requiring members and their spouses³ to disclose when they buy or sell stocks. The rare bipartisan bill flew through both chambers⁵ after a series of national news stories raised questions about whether lawmakers were profiting from their jobs.

Now there's a bipartisan push again — this time to ban lawmakers from trading individual stocks at all. Proponents⁶ say it's important to take the step to remove all doubt or charges of conflicts of interest that could stem from members using information from classified briefings or committee meetings to make money in the market.

House Speaker Nancy Pelosi, D-Calif., doesn't personally trade stocks — her husband does and the transactions are reported regularly.

When asked earlier this month about new efforts to change the law to ban trading for members of Congress, the speaker backed the current system.

"We are a free market economy. They should be able to participate in that," she said.

But the current law has a mixed record. Reports filed by lawmakers exposed trades by members of both parties in 2020 that resulted in profits after briefings on the seriousness of the pandemic. The Justice Department reviewed several cases but ultimately didn't pursue any charges.

And a host of critics say too many members of Congress fail to file reports required under the rules, or file them months late, and there are no real consequences.

Kedric Payne, general counsel for the Campaign Legal Center, said polls overwhelmingly show support for changing the law.

"Members of Congress are finally seeing that the public wants to know that they are not acting⁷ in their own personal interests when they make official decisions," Payne told NPR. His group has filed complaints with the Office of Congressional Ethics⁸ and Senate ethics committee detailing violations¹⁰ with the current law. Payne says there are more than 50 instances in the last year of members not disclosing their stock trades in the time period required.

The push to further restrict how members can invest has united members across the political spectrum¹¹, from liberals like New York Democratic Rep. Alexandria Ocasio-Cortez to conservative Texas Republican Chip Roy.

Bills introduced in the House and Senate would ban trading for lawmakers; others extend the ban to spouses and other family members.

Pelosi is a case in point. NPR reported recently that investors¹² are following the trades of Pelosi's husband — even when spouses comply with disclosure rules, investors think they could have an inside track.

Top House Republican is a new voice in reform push, but GOP members are split

House Minority Leader Kevin McCarthy, R-Calif., thinks it's now time for lawmakers to stop buying and selling individual stocks.

"I cannot imagine being a speaker of the House with the power of what can come before committee, you name them and what can come to the floor and trading millions of dollars worth of options. I just don't think the American people think that's right," McCarthy told NPR earlier this month. He noted¹³ he doesn't currently trade individual stocks.

McCarthy is in line to be speaker if his party gains control of the chamber⁴ in November. He said he was still sorting out details on who would be covered, and whether he would advance his own bill or look at making the change to House rules if the GOP gains the majority after the midterms.

But as McCarthy adds his voice to a new push to change the law, his own members are split.

Colorado Republican Ken¹⁴ Buck¹⁵ told NPR, "I think it's a good idea" to ban members from trading stocks. He doesn't think members are abusing the system or acting inappropriately, but said it's an appearance problem.

"I don't know of anybody that has profited. But I do know that members of the public are questioning whether we get insider information," Buck said.

Texas GOP Rep. Pete Sessions disagrees with the need for a new law. "I don't believe it's necessary," he said. Still he did agree with Buck that it's important to demonstrate to the public there's no conflict of interest and pointed¹⁶ out that the current law mandates¹⁷ filing timely reports or facing a fine.

Sessions, however, admitted he failed to disclose a trade within the required period.

"I should have recorded it, but I didn't have the paperwork on it or something. So I think I've asked for a waiver at least once, maybe twice. But I reported it within a reasonable period of time," Sessions said.

Nebraska GOP Rep. Don Bacon is torn about whether a new law is needed.

"I got mixed feelings. I don't have any myself. I do mutual¹⁸ funds. I think there's risk if you have stocks. A lot of legislation we're working on could impact it. Committee hearings, you hear stuff. So I think I think I'd be really cautious if you have stocks," he said.

There's also debate over rules for spouses

California Republican Rep. Darrell Issa, one of the wealthiest members of Congress, stopped trading stocks once he got elected. "I made that decision because it made an abundance of simplicity¹⁹ that you have no conflicts — other than the broad conflict of I want the country to do well."

He said it's time to update the law. He added that members of the judicial²⁰ branch should also be covered. But he said there are some practical issues to work out to implement²¹ an "outright²² ban" related to when new members are sworn in and transition to any possible new rules. He pointed to some lawmakers' personal holdings they had before taking office, and the situation of many spouses.

"We have spouses that are CEOs of public companies, we have lots of them that are employees of companies that grant stock options that they then sell," Issa told NPR.

Facing pressure on the issue, Pelosi asked the panel overseeing the House last week to investigate how the current law is working and consider increasing fines.

"The Speaker believes that sunlight is the best disinfectant and has asked Committee on House Administration Chair Zoe Lofgren to examine the issue of Members' unacceptable noncompliance with the reporting requirements in the STOCK Act, including the possibility of stiffening²³ penalties," Pelosi's spokesman Drew Hammill said. He added, "To be clear, insider trading is already a serious federal criminal and civil violation⁹ and the Speaker strongly supports robust²⁴ enforcement of the relevant statutes²⁵ by the Department of Justice and the Securities and Exchange Commission."

Pelosi does back extending the law to federal judges, but she is facing increasing calls from her own members in an election year to to go further.

There's talk of making the rules consistent across 3 branches of government

White House economic director Brian Deese said on CNBC last week that the idea of a ban for lawmakers to match restrictions²⁶ for the executive branch was "certainly sensible."

"One of the things that we need to do across the board is restore faith in our institutions — whether that be Congress and the legislative²⁷ branch or whether that be the Fed and others. And so anything we can do to try to restore that faith I think makes a lot of sense," Deese said.

White House press secretary Jen Psaki sidestepped a question Tuesday when asked about the president's position on whether lawmakers should be able to trade stocks. She noted that President Biden didn't trade stocks when he served in the Senate.

Psaki said Biden "believes that everyone should be held to the highest standard." But she added, "He'll let members of leadership in Congress and members of Congress determine what the rules should be."

Recently, the Federal Reserve added restrictions following a controversy²⁸ over two officials' investments. Fed Chair Jerome Powell was pressed last week by Sen. Jon Ossoff, D-Ga., about the appearances of conflicts. Ossoff introduced legislation to ban trading for lawmakers and their spouses last week. Powell noted his agency's new rule will "effectively end any ability to actively²⁹ trade of any senior Fed official."

"I completely agree that the public's faith that we are working to their benefits is absolutely critical," Powell said.

1 momentum   

n.动力，冲力，势头；动量

参考例句：

• We exploit the energy and momentum conservation laws in this way.我们就是这样利用能量和动量守恒定律的。
• The law of momentum conservation could supplant Newton's third law.动量守恒定律可以取代牛顿第三定律。

2 transcript   

n.抄本，誊本，副本，肄业证书

参考例句：

• A transcript of the tapes was presented as evidence in court.一份录音带的文字本作为证据被呈交法庭。
• They wouldn't let me have a transcript of the interview.他们拒绝给我一份采访的文字整理稿。

3 spouses   

n.配偶，夫或妻( spouse的名词复数 )

参考例句：

• Jobs are available for spouses on campus and in the community. 校园里和社区里有配偶可做的工作。 来自辞典例句
• An astonishing number of spouses-most particularly in the upper-income brackets-have no close notion of their husbands'paychecks. 相当大一部分妇女——特别在高收入阶层——并不很了解他们丈夫的薪金。 来自辞典例句

4 chamber   

n.房间，寝室；会议厅；议院；会所

参考例句：

• For many,the dentist's surgery remains a torture chamber.对许多人来说，牙医的治疗室一直是间受刑室。
• The chamber was ablaze with light.会议厅里灯火辉煌。

5 chambers   

n.房间( chamber的名词复数 )；（议会的）议院；卧室；会议厅

参考例句：

• The body will be removed into one of the cold storage chambers. 尸体将被移到一个冷冻间里。 来自《简明英汉词典》
• Mr Chambers's readable book concentrates on the middle passage: the time Ransome spent in Russia. Chambers先生的这本值得一看的书重点在中间：Ransome在俄国的那几年。 来自互联网

6 proponents   

n.（某事业、理论等的）支持者，拥护者( proponent的名词复数 )

参考例句：

• Reviewing courts were among the most active proponents of hybrid rulemaking procedures. 复审法院是最积极的混合型规则制定程序的建议者。 来自英汉非文学 - 行政法
• Proponents of such opinions were arrested as 'traitors. ' 提倡这种主张的人马上作为“卖国贼”逮捕起来。 来自辞典例句

7 acting   

n.演戏，行为，假装；adj.代理的，临时的，演出用的

参考例句：

• Ignore her,she's just acting.别理她，她只是假装的。
• During the seventies,her acting career was in eclipse.在七十年代，她的表演生涯黯然失色。

8 ethics   

n.伦理学；伦理观，道德标准

参考例句：

• The ethics of his profession don't permit him to do that.他的职业道德不允许他那样做。
• Personal ethics and professional ethics sometimes conflict.个人道德和职业道德有时会相互抵触。

9 violation   

n.违反(行为)，违背(行为)，侵犯

参考例句：

• He roared that was a violation of the rules.他大声说，那是违反规则的。
• He was fined 200 dollars for violation of traffic regulation.他因违反交通规则被罚款200美元。

10 violations   

违反( violation的名词复数 )； 冒犯； 违反（行为、事例）； 强奸

参考例句：

• This is one of the commonest traffic violations. 这是常见的违反交通规则之例。
• These violations of the code must cease forthwith. 这些违犯法规的行为必须立即停止。

11 spectrum   

n.谱，光谱，频谱；范围，幅度，系列

参考例句：

• This is a kind of atomic spectrum.这是一种原子光谱。
• We have known much of the constitution of the solar spectrum.关于太阳光谱的构成，我们已了解不少。

12 investors   

n.投资者，出资者( investor的名词复数 )

参考例句：

• a con man who bilked investors out of millions of dollars 诈取投资者几百万元的骗子
• a cash bonanza for investors 投资者的赚钱机会

13 noted   

adj.著名的，知名的

参考例句：

• The local hotel is noted for its good table.当地的那家酒店以餐食精美而著称。
• Jim is noted for arriving late for work.吉姆上班迟到出了名。

14 ken   

n.视野，知识领域

参考例句：

• Such things are beyond my ken.我可不懂这些事。
• Abstract words are beyond the ken of children.抽象的言辞超出小孩所理解的范围.

15 buck   

n.雄鹿，雄兔；v.马离地跳跃

参考例句：

• The boy bent curiously to the skeleton of the buck.这个男孩好奇地弯下身去看鹿的骸骨。
• The female deer attracts the buck with high-pitched sounds.雌鹿以尖声吸引雄鹿。

16 pointed   

adj.尖的，直截了当的

参考例句：

• He gave me a very sharp pointed pencil.他给我一支削得非常尖的铅笔。
• She wished to show Mrs.John Dashwood by this pointed invitation to her brother.她想通过对达茨伍德夫人提出直截了当的邀请向她的哥哥表示出来。

17 mandates   

托管（mandate的第三人称单数形式）

参考例句：

• Individual mandates would require all people to purchase health insurance. 个人托管要求所有人都要购买健康保险。
• While I agree with those benefits, I'm not a supporter of mandates. 我同意上述好处，我不是授权软件的支持者。

18 mutual   

adj.相互的，彼此的；共同的，共有的

参考例句：

• We must pull together for mutual interest.我们必须为相互的利益而通力合作。
• Mutual interests tied us together.相互的利害关系把我们联系在一起。

19 simplicity   

n.简单，简易；朴素；直率，单纯

参考例句：

• She dressed with elegant simplicity.她穿着朴素高雅。
• The beauty of this plan is its simplicity.简明扼要是这个计划的一大特点。

20 judicial   

adj.司法的，法庭的，审判的，明断的，公正的

参考例句：

• He is a man with a judicial mind.他是个公正的人。
• Tom takes judicial proceedings against his father.汤姆对他的父亲正式提出诉讼。

21 implement   

n.(pl.)工具，器具；vt.实行，实施，执行

参考例句：

• Don't undertake a project unless you can implement it.不要承担一项计划，除非你能完成这项计划。
• The best implement for digging a garden is a spade.在花园里挖土的最好工具是铁锹。

22 outright   

adv.坦率地；彻底地；立即；adj.无疑的；彻底的

参考例句：

• If you have a complaint you should tell me outright.如果你有不满意的事，你应该直率地对我说。
• You should persuade her to marry you outright.你应该彻底劝服她嫁给你。

23 stiffening   

n. (使衣服等)变硬的材料, 硬化 动词stiffen的现在分词形式

参考例句：

• Her mouth stiffening, she could not elaborate. 她嘴巴僵直，无法细说下去。
• No genius, not a bad guy, but the attacks are hurting and stiffening him. 不是天才，人也不坏，但是四面八方的攻击伤了他的感情，使他横下了心。

24 robust   

adj.强壮的，强健的，粗野的，需要体力的，浓的

参考例句：

• She is too tall and robust.她个子太高，身体太壮。
• China wants to keep growth robust to reduce poverty and avoid job losses,AP commented.美联社评论道，中国希望保持经济强势增长，以减少贫困和失业状况。

25 statutes   

成文法( statute的名词复数 )； 法令； 法规； 章程

参考例句：

• The numerous existing statutes are complicated and poorly coordinated. 目前繁多的法令既十分复杂又缺乏快调。 来自英汉非文学 - 环境法 - 环境法
• Each agency is also restricted by the particular statutes governing its activities. 各个机构的行为也受具体法令限制。 来自英汉非文学 - 环境法 - 环境法

26 restrictions   

约束( restriction的名词复数 )； 管制； 制约因素； 带限制性的条件（或规则）

参考例句：

• I found the restrictions irksome. 我对那些限制感到很烦。
• a snaggle of restrictions 杂乱无章的种种限制

27 legislative   

n.立法机构，立法权；adj.立法的，有立法权的

参考例句：

• Congress is the legislative branch of the U.S. government.国会是美国政府的立法部门。
• Today's hearing was just the first step in the legislative process.今天的听证会只是展开立法程序的第一步。

28 controversy   

n.争论，辩论，争吵

参考例句：

• That is a fact beyond controversy.那是一个无可争论的事实。
• We ran the risk of becoming the butt of every controversy.我们要冒使自己在所有的纷争中都成为众矢之的的风险。

29 actively   

adv.积极地，勤奋地

参考例句：

• During this period all the students were actively participating.在这节课中所有的学生都积极参加。
• We are actively intervening to settle a quarrel.我们正在积极调解争执。