According to an academic
study published this year, stocks held by members of the U.S. House out-earn
the market by an average 6 percent annually. That's either really
lucky or really unfair.
In a recent Huffington Post article, Dan Froomkin speculates that the above-average
returns that members of the U.S. Congress see from their stock holdings
may be the result of biased voting and trading on non-public information.
And, it's not just the House. The researchers involved in this year's
study conducted one five years ago that analyzed the stock returns for
members of the U.S. Senate. According to that study, stocks held by U.S.
Senators outperform even those held by U.S. Reps - an average of 10 percent
per year over the market.
Yet, despite the indications that these abnormally positive returns may
be obtained unfairly, neither federal law nor Congress' codes of conduct
restrict the financial actions of senators or representatives.
"House rules don't require them to divest themselves of common
stocks when they assume office, don't prevent them from trading freely
while in office - and don't require them to recuse themselves from
votes that could affect their own interests," writes Froomkin. (For
more, read the entire articlehere.)
H.R. 1148 (the Stop Trading on Congressional Knowledge Act) was recently
re-introduced by Rep. Timothy Walz (D-MN) and several Democratic co-sponsors.
Unsurprisingly, no actions have been taken on the bill since March 29,
when it was referred to the House Ethics committee.
Also not surprising - 100 percent of the users on OpenCongress.org
support the passage of the bill.