Almost exactly 10 years after the Stop Trading on Congressional Knowledge (STOCK) Act was signed into law, the House Administration Committee held a hearing examining congressional stock trading and potential reforms.
This hearing, held on April 7, 2022, was years in the making and reflective of a newfound acknowledgement by Congress that voters have a right to know that their leaders are acting in the public interest, not in the interest of their own wallets.
Members have introduced legislation in both chambers, prompted by public outrage, reporting and complaints. The hearing was seemingly designed to help members of the U.S. House of Representatives get their bearings on this issue as they evaluate the proposals and eventually decide on what the reform will ultimately look like.
The hearing is one small step in the direction of actualizing congressional stock trading reform. Some key takeaways from the hearing provide hope that these efforts will continue to move in the right direction.
Constituents and Congress alike care about this issue. On several occasions, members of the committee referenced questions other lawmakers and their constituents had about this issue. This reflects what CLC’s polling has already established: voters deeply care about preventing corruption in Congress and restricting congressional stock trading is a popular reform to restore trust in Congress.
Committee members affirmed that Congress wants to do the right thing. While referencing their own disclosures and stock trading habits, the committee members affirmed that most members of Congress are trying to do the right thing. Lawmakers from both sides of the political spectrum voiced openness to move forward on reforms.
Certain lines of questioning continued to make the case for reform. Some questions about prosecuting insider trading by lawmakers, quantifying conflicts of interest and why stock trading (instead of real property ownership, e.g.) should be restricted further made the case for reform — even though they seemed designed to challenge the reform efforts.
For example, the fact that no one has been prosecuted under the STOCK Act does not mean sensitive congressional information has not been improperly used for private gain, just that no case has been fully investigated or has risen to the level of an insider trading conviction.
The fact that we cannot accurately determine how many members are making decisions in the interest of their stock portfolios means that action is necessary to prevent the public from having to guess about lawmakers’ conflicts of interest.
All in all, the hearing provided a good jumping off point for the further development of reform options. If Congress is serious about showing the public its commitment to public trust, the information learned in this hearing should be utilized to implement reforms that voters clearly want.