Brian Baird, who represented Southwest Washington in Congress from 1999-2011, isn’t buying the excuses. Neither should the American people.
A recent report from Raw Story, a left-leaning news website, details a disturbing number of representatives and senators from both political parties who seemingly have violated federal insider trading and conflict-of-interest laws. While the oversights are disturbing, some of the excuses are downright comical, which led Baird to tell the news outlet:
“I mean, come on. ‘The dog ate my homework,’ aren’t we a little more grown up than that? If we’re capable of voting on whether or not to raise or lower taxes or send people to war, I think we can report when we make an investment.”
According to Raw Story, some of the “explanations” for not reporting stock trades, as required by federal law, are just as silly as that old trope about homework. “I mistakenly left it in draft,” said Rep. Dan Bishop, R-N.C. “A clerical error,” claimed Sen. Tom Carper, D-Del. “Administrative error,” charged Rep. Kathy Manning, D-N.C.
There are numerous ways in which members of Congress in recent years have betrayed the trust of the public. But there is something simplistic and fundamental about those who are expected to manage a federal budget that annually exceeds $6 trillion yet are unable to follow the law regarding personal financial transactions.
Raw Story identified 39 members of Congress who apparently have violated reporting laws in the past year. They include Washington Republican Reps. Dan Newhouse and Cathy McMorris Rodgers.
Newhouse failed to properly report $765,000 in personal stock transactions, in some cases disclosing them 18 months later than required. That renders him as responsible compared with Rep. Rick Allen, R-Ga., who was as much as 6½ years late in reporting transactions totaling $8.5 million.
In an age when Congress has difficulty keeping government running and is unable to devise sensible immigration policy, the trading of stocks might seem a secondary concern. But there is good reasoning behind the Stop Trading on Congressional Knowledge, or STOCK, Act, which was originally written by Baird and eventually passed in 2012.
As Baird said at the time: “One line in a bill in Congress can be worth millions and millions of dollars. There was one night, we had a late, late night caucus and you could kind of tell how a vote was going to go the next day. I literally walked home and I thought, ‘Man, if you went online and made some significant trades, you could make a lot of money on this.’ ”
For example, according to Raw Story, Sen. Markwayne Mullin, R-Okla., purchased between $15,001 and $50,000 worth of stock in Raytheon on Sept. 13. That month, Raytheon was awarded more than $1.7 billion in defense contracts. Various studies have shown that, on average, the portfolios of congressional members perform much better than the stock market overall.
And the standard fine for violating the STOCK Act is $200 — a pittance if an investor reaps hundreds of thousands or even millions of dollars.
Clearly, sturdier guardrails are needed. Several bills have been introduced to stop even the appearance of insider trading, most recently the Ban Congressional Stock Trading Act. But until the American people express outrage over the situation, members of Congress are likely to simply continue making excuses.
