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Many believe it's time to do away with lawmakers making stock trades

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Re: Many believe it's time to do away with lawmakers making stock trades

#141

Post by wanderindev »

bern4444 wrote: post #67

Trading activity should be limited for federal employees at that level in a similar manner that trading is limited for bank employees and their families. They should be allowed to trade index funds, etfs, mutual funds etc, but perhaps not individual stocks. Or perhaps there should be a bi-annual or quarterly trading period where they're allowed to trade individual stocks. Should they be allowed to also trade derivati…

Congressional representatives should 100% be held bare minimum to the standard that bank employees are if not more.

As per raises, they haven't received one since 2009 and I think it'd definitely make sense to peg that to inflation.

In general though, they're securing a pension via this job which even though it's not their full salary it will set them up for retirement better than the average investing would.

Re: Many believe it's time to do away with lawmakers making stock trades

#143

Post by Pxtl »

ctennis1 wrote: post #73
Pxtl wrote: post #45

Earlier quoted context omitted.

Yeah, the spousal loophole is a hard one. Having an elected position restricting a spouse isn't right, but the fact that money can flow freely within a marriage basically annihilates any restrictions. Other non-marital transactions can be controlled - that's the basis of half the tax system in every country. The moment money leaves a household or arrives in a household, there are laws about the transaction. But withi…

Not really - I work for a company in the financial space and my spouse is restricted on any trading they can do just like I am.

Today I Learned... of course, the distinction might be that firing an elected official is far more complicated than firing a hired fintech guy.

Re: Many believe it's time to do away with lawmakers making stock trades

#144

Post by colpabar »

pirate787 wrote: post #134
pclmulqdq wrote: post #111

Earlier quoted context omitted.

I think the cleanest law here is to change the law to clarify that non-public information gained by public servants and representatives that can have an affect on a stock's price should be treated as "material non-public information." Then the SEC can do their jobs like they do with other insider traders. Remember that ONLY elected congresspeople are exempt from rules like that. Other public servants are not. This is…

> "This is one of the biggest signals that the US is an oligarchy and not a democracy." The constitutional doctrine of separation of powers generally limits regulatory law enforcement by the executive against the legislative branch. This is actually a signal of constitutionally limited government-- this is a design feature.

This feels like a stretch. I really doubt anyone who designed the constitution intended to give lawmakers the ability to trade on insider information obtained through their position legally.

Re: Many believe it's time to do away with lawmakers making stock trades

#145

Post by sillyquiet »

pirate787 wrote: post #134
pclmulqdq wrote: post #111

Earlier quoted context omitted.

I think the cleanest law here is to change the law to clarify that non-public information gained by public servants and representatives that can have an affect on a stock's price should be treated as "material non-public information." Then the SEC can do their jobs like they do with other insider traders. Remember that ONLY elected congresspeople are exempt from rules like that. Other public servants are not. This is…

> "This is one of the biggest signals that the US is an oligarchy and not a democracy." The constitutional doctrine of separation of powers generally limits regulatory law enforcement by the executive against the legislative branch. This is actually a signal of constitutionally limited government-- this is a design feature.

Yeah, and this means the regulation of shady activity on the part of the legislature falls to the legislative body itself. And I get the philosophy behind it, but it's the figurative fox guarding the henhouse here. This is why any legislature proposed by the few principled figures in Congress that proposes to curb corrupt practices like this in the legislature is usually dead on arrival.

Re: Many believe it's time to do away with lawmakers making stock trades

#146

Post by dragonwriter »

wanderindev wrote: post #141
bern4444 wrote: post #67

Trading activity should be limited for federal employees at that level in a similar manner that trading is limited for bank employees and their families. They should be allowed to trade index funds, etfs, mutual funds etc, but perhaps not individual stocks. Or perhaps there should be a bi-annual or quarterly trading period where they're allowed to trade individual stocks. Should they be allowed to also trade derivati…

Congressional representatives should 100% be held bare minimum to the standard that bank employees are if not more. As per raises, they haven't received one since 2009 and I think it'd definitely make sense to peg that to inflation. In general though, they're securing a pension via this job which even though it's not their full salary it will set them up for retirement better than the average investing would.

> As per raises, they haven't received one since 2009 and I think it'd definitely make sense to peg that to inflation.

I think it would make more sense to peg it to the lower of a set multiple of each per capita GDP and median after-tax-benefits adult individual income, with th multiples set so that they both work out equal the current pay now.

Rewarding Congress for driving up average consumer prices when they are paid far enough above median income to start that their spending basket is different is...perhaps not well considered.

But any peg has a problem that ultimately, whoever is measuring the thing to which pay is pegged is accountable to Congress, so the result is to make the measure less trustworthy by tying Congressional pay to it. Forcing Congress to vote on their pay changes and face election after they do so and before they go into effect, as the last-ratified-amendment of the Bill of Rights requires, is not only Constitutionally-mandatory, but a very good idea.

Re: Many believe it's time to do away with lawmakers making stock trades

#147

Post by cpeterso »

dtech wrote: post #113
nearbuy wrote: post #101

Earlier quoted context omitted.

Investing in an index fund might even incentivize them to ensure the economy as a whole does well.

Incentivizing that large public companies do well, not quite the same.

Then make it a total market index fund with small, mid-size, and large companies.

Re: Many believe it's time to do away with lawmakers making stock trades

#148

Post by throwawayboise »

flatiron wrote: post #50
themanmaran wrote: post #15

Outright banning trades will only obscure congressional trading (shell corps, friends/family, etc.) I would prefer a public registry listing all congressional trades. I know this is legally available data, but very difficult to access.

They should be allowed to go in something like an S&P 500 index fund. But personally I have blackout dates trading my own company stock why don’t they have any restrictions?

I'd go further and say they should be forced to put all assets other than their primary home into a blind trust for the duration of their time in office and 12 months afterwards.

Might reduce people from making a career out of being a politician, but that would be a good thing. Too many cases of middle-class representatives and senators leaving office decades later as multi-millionaires.

Politics should be something people do out of a sense of service, not to become wealthy.

Re: Many believe it's time to do away with lawmakers making stock trades

#149

Post by camjohnson26 »

lastofthemojito wrote: post #81
camjohnson26 wrote: post #54

Earlier quoted context omitted.

I wouldn’t make it a Republican/Democrat thing since that’s guaranteed to start a flame war, Pelosi’s husband is the highest profile culprit but as you said corruption is widespread.

Pelosi's husband isn't a lawmaker himself though ... which makes me wonder, if there was a ban on lawmakers (and their spouses) actively trading, I wonder if we'd see divorces of convenience. "Oh sure, my ex-husband (and now boyfriend) trades stocks, but that's none of the public's business". Gotta think people who have an edge that can help them get rich(er) will do anything within the letter of the law to keep that…

My company got acquired by a big 4 accounting firm and the rules for independence are pretty strict. Some people left after the acquisition because they were living with a partner, unmarried, who would be required to sell stocks under the independence rules.

Re: Many believe it's time to do away with lawmakers making stock trades

#150

Post by b3morales »

whywhywhywhy wrote: post #55

I'm completely fine with politicians being paid significantly more if them, their partners and their relatives faced serious prison time is they did the sort of insider trading that is considered completely normal and weirdly they're allowed to do but it's illegal if the lowly plebs do it. End of the day these people are paid very little on paper for the amount of pressure and responsibility yet if you follow their f…

U.S. Reps and Senators have an annual salary of around $180,000*, which is in the order of twice the national median income. Why do you think they need to be paid more?

---

*They also have a baked-in-statute annual cost of living adjustment, which is more than we can say for the vast majority of people in the country. Though they have voted not to take it for the last decade. (If they had, I believe the current salary would be upwards of $200K.)

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