A bill banning congressional stock trading has been scheduled for a hearing, despite the anticipation that it would be marked up in the committee. Up to 20 congress members outperformed the market by substantial margins, with some linked to trading activities in industries where they held legislative powers.
U.S. Rep. Seth Magaziner said that some representatives who were actively involved in the bill believed it would be a markup. However, the bill ended up being scheduled for a hearing instead.
The politician noted that the hearing could still be a positive step toward implementing the bill if the order process eventually leads to a markup and a floor vote. However, he expressed deep concerns that the hearing could be a “delaying tactic” by the speaker, which he deemed unacceptable.
Rep Anna calls congressional stock trading corruption at its core
On November 10th, Representative Anna Paulina Luna, who also supports the bill, wrote that House Speaker Michael Johnson had notified her that the bill to ban “insider trading” would be marked up in committee after the government reopens.
Rep. Luna wrote in July that she will initiate the discussion on banning stock trading for members of Congress. She explained that members of Congress serving on committees that influence legislation in relevant industries were trading stocks in those industries. She called it “corruption at its core” and emphasized that it needed to come to an end.
The 2024 Congress trading report showed members of Congress managed to outperform the market. Their portfolios recorded staggering gains, especially in industries where they had direct influence and legislative power. The report revealed that more than 20 members managed to double the S&P 500 average gain of 24.9%.
Rep. David Rouzer led the pack with a staggering 149% increase, while Rep. Debbie Wasserman Schultz and Rep. Ron Wyden followed with 142.3% and 123.8% increases, respectively. These returns represent over 4 times the returns registered by legendary investor Warren Buffett’s best year, whose investment firm, Berkshire, managed only 31.8% in 1981. Both republicans and democrats experienced similar gains on average. Democrats saw an estimated 31% increase in their portfolio, while Republicans managed a 26% increase.
Congress members trade in industries where they possess legislative influence
The report also cited evidence of instances where some members engaged in trading activities in industries where they held legislative powers. Wasserman Schultz bought shares of Viasat, a satellite operator, in October while actively serving the House Appropriations Subcommittee on military construction. The satellite company has received government contracts worth more than $2.7 million over the past five years, resulting in a 41% increase in its stock price since the company’s investment.
In April, U.S. President Donald Trump said in an interview that he would sign legislation to ban stock trading activities among members of Congress if the bill reached his desk. In the interview, he discussed watching Nancy Pelosi “get rich through insider information” and stated that he would be okay with signing the bill into law.
The ban on congressional stock trading has garnered bipartisan support for some time, although the proposal has never garnered enough votes to pass both chambers. Nancy Pelosi had initially raised opposition to challenge the legislation in 2022, but later dropped it. Pelosi’s fame had been tied to American politics for a long time. However, in recent years, she has earned the nickname “The queen of stock trading.”
Her stock performance attracted nearly 130,000 investors who invested half a billion dollars in the Pelosi Tracker platform. The tracer registered that her stock portfolio is up a whopping 32.5%.
Both republicans and democrats have shown enthusiasm for the stock ban. The popularity of the Pelosi Tracker app also suggests that members of the public are keenly interested in the trading activities of Congressional members.
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