President Barack Obama Wednesday signed the Stop Trading on Congressional Knowledge (STOCK) Act nearly five months after CBS's 60 Minutes report on how some members of Congress had been profiting from financial trades based upon undisclosed Congressional knowledge, commonly referred to as insider trading. (See: OUTRAGE OF THE DAY: Insider Trading In Congress)
"The STOCK Act makes it clear that if members of Congress use nonpublic information to gain an unfair advantage in the market, then they are breaking the law. It creates new disclosure requirements and new measures of accountability and transparency for thousands of federal employees. That is a good and necessary thing," Obama said during remarks while signing the bill. "We were sent here to serve the American people and look out for their interests -- not to look out for our own interests."
You wouldn't think Congress would actually need a law banning themselves from trading on inside political information, but it turns out they do because there is a pervasive "cultural problem" penetrating Washington, D.C. "It's not about the money, it's about a sense of entitlement," says Peter Schweizer, author of Throw Them All Out and the centerpiece of the 60 Minutes expose. "It's a sense of 'I deserve to have more and the rules don't apply to me.'"
Schweizer is largely responsible for galvanizing the American public to speak up in outrage against our members of Congress who seem to believe they are above the law. He joined The Daily Ticker's Aaron Task to discuss his so-called 'victory' on this issue.
"It's an example of how you can actually move the ball in the right direction occasionally," he says. "I think what made the difference here was that people read [the book], were frustrated by what they saw and they took action. They contacted their Congressmen…. [who] want to keep their job, so they listened."
Unlike so many issues in today's political discourse, this is one without a derisive partisan divide. Conservatives and liberals alike do not believe Congress should be allowed to live and act by a separate set of rules.
"We have a problem in Washington, D.C. that the people who are supposed to abide by these rules are the very same people who get to write the rules," says Schweizer. "That means there are loopholes in this bill."
While the STOCK Act is a step in the right direction, Schweizer believes more must be done to rein in our self-enriching Congress.
"I think it is fine to have a law that says [insider trading] is illegal, but I think we need to go a step further and just say for example, that if you are on the Senate Banking Committee, you should not be trading bank stocks, period," he says. "It just creates opportunities for abuse."
President Obama said as much today as well. "There's obviously more that we can do to close the deficit of trust and limit the corrosive influence of money in politics. We should limit any elected official from owning stocks in industries that they have the power to impact," he said. "We should make sure people who bundle campaign contributions for Congress can't lobby Congress, and vice versa. These are ideas that should garner bipartisan support. They certainly have wide support outside of Washington. And it's my hope that we can build off today's bipartisan effort to get them done."
Schweizer is also in favor of mandatory blind trusts for members of Congress and more expansive limits on land deals, whereby a member of Congress will buy a piece of land and then earmark a project with federal taxpayer dollars with the goal of enriching their property. "The STOCK Act does nothing to deal with land deals or other graft that is taking place," he says. "It only deals with insider trading."
America needs to "return to the notion of citizen legislature that you are there for a while but you are not there forever," he says.
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- President Barack Obama
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