Insider Trading Bills Take Aim At Congress
UNIDENTIFIED WOMAN: On this vote, the yeas 417; the nays are two. The bill is passed.
AUDIE CORNISH, HOST:
That was the final vote count today in the House on the Stop Trading On Congressional Knowledge Act or the STOCK Act for short. It's the bill to ban insider trading by members of Congress. It turns out virtually no one opposed it - at least, that's the headline. But NPR's Tamara Keith reports that below the surface there's a fight.
TAMARA KEITH, BYLINE: The latest gallop poll puts congressional approval at 10 percent. That's low, historically low, which might explain why members of the House, many of whom had serious issues with the version of the STOCK Act on the floor fell all over themselves to vote yes.
Minnesota Democrat Tim Wallace has been pushing to ban congressional insider trading for years.
REPRESENTATIVE TIM WALLACE: This is a victory, not for us. It is one tiny step on a journey, which is about restoring the faith of the American people in the institution.
KEITH: But here's how fellow STOCK Act crusader, New York Democrat Louise Slaughter describes today's vote.
REPRESENTATIVE LOUISE SLAUGHTER: This is really a ridiculous farce that's going on here. There's no question about it.
KEITH: What has Slaughter steamed is the version of the STOCK Act brought to the floor by House Majority Leader Eric Cantor. It left out a provision that would require people who work in the political intelligence industry to register, much like lobbyists.
Both an earlier House bill and a Senate bill approved overwhelmingly last week took on political intelligence. These firms gather information from members of Congress and their staff and sell it to hedge funds and other investors looking for an advantage.
SLAUGHTER: I mean, this is an industry that makes $400 million. As far as we know, it could be much, much more. Most people think it is. And why can't they be as regulated as a regular lobbyist so that at least members of Congress know to whom you're speaking?
KEITH: Cantor said on the House floor, his bill calls for a study of the political intelligence industry instead.
REPRESENTATIVE ERIC CANTOR: That is a provision that raises an awful lot of questions.
KEITH: A spokesperson for Cantor says it could have affected the first amendment rights of everyone from people in local rotary clubs to journalists. Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington, says the lobbying to kill that provision was intense.
MELANIE SLOAN: And there were rumor campaigns going around about all of the things that Wall Street folks were saying it did which it didn't do, but the real consequence would have been that political intelligence firms would have been brought into the sunlight.
KEITH: The House bill also leaves out a Senate amendment that would make it easier for prosecutors to bring public corruption cases, but some House Republicans raised concerns that it wouldn't hold up to legal challenge.
Cantor insists the House bill is actually stronger and the provisions left out were beside the point, anyway.
CANTOR: The thrust of this bill is about making sure that none of us in elected office or those in the executive branch are able to profit from non-public information. The political intelligence piece is outside of this body and we are talking about us and the perception that has gathered around our conduct.
KEITH: In the debate on the House floor today, one Democrat after another got up and complained about the bill they would be voting on and the process it took to get to the floor without any hearings or amendments. And then everyone said something like this.
REPRESENTATIVE NANCY PELOSI: So I urge our colleagues to vote for to bring the process along.
KEITH: That's House Minority Leader Nancy Pelosi.
PELOSI: I don't want anybody to interpret the strong vote for it to be a feel of approval for what it is, but just a way of pushing the process down the line so that we can move expeditiously to go to conference for the strongest possible bill.
KEITH: The likely next step is a conference committee to work out the differences between the House and Senate versions. Tamara Keith, NPR News, the Capitol.
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