We Have Too Many Stock Trading Bills. Which One Should Actually Pass?

Photo via Forbes

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In March of this year, a group of Republican senators led by Pete Ricketts (R-NE) threw their support behind the Stop Insider Trading Act. A companion to the House’s version introduced in January by Rep. Bryan Steil (R-WI-1), the proposed legislation would ban members of Congress and their families from purchasing stocks while they are in office, require them to publicly disclose any sales in their portfolio 7 to 14 days in advance, and establish financial penalties for any representatives that violate these criteria.

However, this measure is not without criticism. It is a largely an inadequate response to the issue of insider trading; it still allows the ownership of already held stocks and enforces a punishment that essentially amounts to a slap on the wrist. Some of the loudest disapproval came from Dan Osborn, an independent candidate challenging Ricketts for his seat in the Senate election this November. He compared the move to “putting Bernie Madoff in charge of fraud prevention.” He believes that Ricketts’ measure was done to save face in a competitive campaign, noting the senator’s stock trading record while in office.

The decision underscores the reality that a ban on stock trading by Congress and other members of the federal government has remained a popular position for American voters, transcending ideological lines. This practice has arguably led to many conflicts of interest in our government, especially concerning the question of whether officials truly serve their voters as opposed to their own interests. This concern was brought to the limelight at the start of the COVID pandemic as four senators each sold hundreds of thousands of dollars worth of stocks following a classified briefing with President Trump, a month before the stock market crashed—saving them from financial losses as the economy entered into a recession and impacted families across the country.

There have been several recent proposed bills that have garnered support from members of Congress, yet they have remained unsuccessful in reaching the floor for debate, much less an actual vote. With this in mind, which bill is the most successful in stopping congressional insider trading and should be prioritized over the others?

The Alternatives

The main alternative to Ricketts’ bill is the Restore Trust in Congress Act; unlike the former, it would completely prohibit members of Congress from owning any stocks and additionally requires current representatives to divest from their current portfolios within 180 days of the bill’s passage. Though introduced last year by Republican Rep. Chip Roy (R-TX-21), a staunch ally of President Trump, the legislation has been cosponsored by a number of Democratic House representatives that include progressives such as Alexandria Ocasio-Cortez, giving it a realistic and bipartisan path to passage.

However, some Democrats have instead opted to support the Restore Trust in Government Act; while keeping much of the same provisions as Roy’s bill, it notably extends the stock ban to the President and Vice President. However, it undermines the bipartisan effort of the former bill by instead promoting legislation that is guaranteed to receive no Republican support, making it unlikely to even make it to the floor for a vote.

On this issue, Republicans and Democrats should not play political games and instead work together for the common interests of Americans. They should bring The Restore Trust in Congress Act up for debate and passage, as it has the best chance to succeed. This is a non partisan issue that unites all Americans, and both political parties should reflect common consensus. It is a step in the right direction, ensuring that Congress is held more accountable and allowing for more transparency in our government.

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This article was edited by Abigail D’Angelo.