Ban members of Congress from buying, trading stock while in office

Our democracy is predicated on the consent of the governed. But the minute the American people think that their representatives are putting their personal interests first is the minute the American people start to reconsider that consent.

SHARE Ban members of Congress from buying, trading stock while in office
A sign for Wall Street hangs in front of the New York Stock Exchange, on July 8, 2021.

A Wall Street sign hangs in front of the New York Stock Exchange, on July 8, 2021.

AP Photos

There’s an iron rule of investing: Unless you’re Warren Buffett or have access to insider information, you won’t make money trying to outsmart the stock market. In fact, according to a report by CNBC, nearly 80% of professional investors fail to beat the market every year and hardly anyone does over a 10-year period. 

And yet, members of Congress continue to have unusual success trading stocks while in office. Between 2004 and 2010, research found that members of Congress beat the stock market by 20%, with some even beating the market by up to 35%.

When I look around the halls of Congress, I don’t see many Warren Buffetts, but I do see a lot of people with access to insider information. That’s a problem.

Opinion bug

Opinion

And there is an easy solution: Members of Congress should be banned from buying and trading stocks while in office. Full Stop. And we can get this done today — by passing the already written “Ban Conflicted Trading Act,” of which I am a proud co-sponsor.

Since I was first elected in 2018, I’ve not traded a single stock, nor do I own any. I’m no Warren Buffett, and I don’t try to be. Of course, I’ve known when new federal investments were going to cause surges in value for certain sectors and companies. But I refuse to engage in any financial transaction that would cause the American people to question whether their elected officials were putting their self-interest above their public obligations.

I wish my colleagues felt the same way.But too many of them — on both sides of the aisle —have put their self-interest first.The surge in purchases by members of Congress of vaccine and telehealth stocks just before COVID-19 shut our economy down may have an innocent explanation. But to the American people, it’s a hustle that looks out for our private interests and only then addresses the public we serve.

That behavior is unethical. But it’s not illegal. Right now, there’s nothing that bars lawmakers from trading shares of companies that could be affected by laws they pass. The Stock Act, passed in 2012, does ban senators and representatives from using nonpublic information for financial benefit, but it’s almost impossible to enforce. In a world of information abundance, our “insider information” is often knowing which pieces of public information are true rather than holding the smoking-gun of truly private intel.

Our democracy is predicated on the consent of the governed. That consent cannot be mandated.But once it is lost, our entire democracy crumbles — because the minute the American people think that their representatives are putting their personal interests first is the minute the American people start to reconsider that consent. That’s why congressional ethics matters.

Opinion Newsletter

Opinion This Week

A weekly overview of opinions, analysis and commentary on issues affecting Chicago, Illinois and our nation by outside contributors, Sun-Times readers and the CST Editorial Board.

In 2021, Gallup polling found that just 12% of Americans say they have a “great deal” or “quite a lot” of confidence in Congress; 51% said they had “very little” or “no” confidence in Congress. “Internet news” instills more confidence than we in Congress do.

That distrust puts our democracy in danger, but we can fix it. Not through our words, but through our deeds.

Democracy matters. Ethics matters. Integrity matters. We must pass the “Ban Conflicted Trading Act” today.

Sean Casten is the U.S. representative from Illinois’ 6th Congressional District.

Send letters to letters@suntimes.com

The Latest
Police identified the shooting suspect as Robert “Bobby” Crimo III, a 22-year-old who remained on the loose for more than eight hours after the attack in the affluent suburb’s downtown area.
When government refuses to act, it betrays the ideals we celebrate on the Fourth.
The strike also is delaying road resurfacing around Chicago and projects including the Interstate 55 and Weber Road interchange and the Interstate 80 bridge in Joliet.
MLB
Home runs and sacrifice bunts are down. So are strikeouts, but that is almost entirely because of the National League using the DH.
Flanked by a T-shirt in his stall that read “Stars & Stripes & Reproductive Rights,” Hendriks has spoken passionately in support of the LGBTQ community and came out strongly against the Supreme Court’s decision to overturn Roe v. Wade.