Stock Act and 60 Minutes

[Meister]

what do you mean "need to create constitutional laws"?

Sorry, A constitutional amendment that Congress may not pass a law and exempt themselves.

Inside trading is illegal for everyone but members of Congress who reportedly engage in it frequently.

thank you for answering. fair enough. but i don't think you need constitutional amendments for these things. perhaps if they got run out of office for it like they do for flashing their genitals at someone??

the voters are at fault for having warped priorities.

So are you saying that they don't need a law passed to prohibit this? Or, that we need to just vote better and still they have the privy if they wish?

 

[deaddogseye]

There was a bit of a scandal back in the 80s about a congresscritter here in Oregon who got in trouble for insider trading on confidential information given to the agriculture committee.

However the man lost money at it, so the prosecution was dropped.

when did it become legal for congress to do this?

has it always been?

Technically yes it has always been legal. This is not a matter of congress exempting itself from a law though. The law applies to themjust as it does to any one else, but this is just not a violation of the law. For it to be insider trading you have to have undisclosed material information concerning the issuer basically that comes from the issuer. So for example if you learn from an insider at microsoft that microsoft will report lower than expected earnings next week - -but hasnt done so yet and then go out and sell microsoft stock -- that is a violation of the law.

But lets say instead that because of your job you learn that the price of rubber is going to go way up - and you realize this will really hurt say goodyear stock as a tire producer. BUT you didnt learn this from Goodyear. You learned it from an unrelated contact in south america and you realize the effect it will have on their stock and sell it. This is NOT a violation of the law because you got the information from a source other than through Goodyear.

This second example is more what the situation is with Congres -- even though they can do things like effect legislation that will have an effect on the price of stocks.

This is a bit simplistic but that is basically the distinction. So this is not a case of Congress exempting itself from a law. Anyone who had such an advantage from their job could do the same thing.

And it may not be illegal but ethical is another thing of course

 

[deaddogseye]

Sorry, A constitutional amendment that Congress may not pass a law and exempt themselves.

Inside trading is illegal for everyone but members of Congress who reportedly engage in it frequently.

thank you for answering. fair enough. but i don't think you need constitutional amendments for these things. perhaps if they got run out of office for it like they do for flashing their genitals at someone??

the voters are at fault for having warped priorities.

So are you saying that they don't need a law passed to prohibit this? Or, that we need to just vote better and still they have the privy if they wish?

you would need a law - though not necessarily a constitutional amendment to prohibit this. Or congress could prohibit it through their ethics rules if they want to.

 

[deaddogseye]

Sorry, A constitutional amendment that Congress may not pass a law and exempt themselves.

Inside trading is illegal for everyone but members of Congress who reportedly engage in it frequently.

thank you for answering. fair enough. but i don't think you need constitutional amendments for these things. perhaps if they got run out of office for it like they do for flashing their genitals at someone??

the voters are at fault for having warped priorities.

So are you saying that they don't need a law passed to prohibit this? Or, that we need to just vote better and still they have the privy if they wish?

and there would be some very difficult legal issues presented - or there could be - if you tried to change the law. You would have to decide if you were going to change the law as it applies to everyone or just to Members of congress (and staffs?). If you just want to limit it to Congress then it would be better as an ethical rule. It would be very problematic to try to expand the reach of the law to everyone in situations analogous to this -- actually it would involve an enormous expansion of the reach of federal regulation in this area. Basically, every time a Member made money on a trade it would become suspect.

I dont defend these people at all in this regard but it would be tricky to write a law that outlaws it.

Now you simply could say that if you are in Congress you cant trade stock or you have to put everything in a blind trust. That would presumably address it.