House Democrats Who Want Stock Trading Ban 'Disappointed' by GOP Proposal

A trio of Democrats in the US House of Representatives leading the fight for a congressional stock trading ban ripped Republican leadership's proposal as an inadequate replacement in a Monday statement released ahead of a scheduled committee markup.

Politico reported last month that House Speaker Mike Johnson (R-La.) and Administration Committee Chair Bryan Steil (R-Wis.) briefed GOP lawmakers on their plan for a bill that would ban members of Congress from buying new stocks but let them keep what they already have.

Steil introduced the Stop Insider Trading Act on Monday and announced a Wednesday markup. Backed by Johnson and other GOP leaders, the legislation would also apply to lawmakers' spouses and dependent children, and require public notice a week before any of them sell stock.

However, Reps. Pramila Jayapal (D-Wash.), Seth Magaziner (D-RI), and Alexandria Ocasio-Cortez (D-NY) argued in a joint statement that "any bill that still allows members of Congress to own and trade stocks falls far short of what the American people want and deserve."

"We are disappointed that the bill introduced by Republican leadership today fails to deliver the reform that is needed and instead protects the wealthiest members of Congress by allowing them to continue to hold and sell stock," said the original co-sponsors of the bipartisan Restore Trust in Congress Act.

The Democrats stressed that "while this bill prohibits members from buying new stocks, it does nothing to remove the conflict of interest that arises from owning or selling existing stocks. Members can still act on legislation, investigations, and briefings that directly influence the value of their stocks for personal benefit."

"The American public deserves to know that members of Congress are making decisions in the public interest, not in the interest of their own pocketbooks. The only way to restore Americans' trust is to ban members of Congress from owning and trading stocks," the trio continued.

"We hope that Speaker Johnson will find the courage to move the Restore Trust in Congress Act, a bipartisan consensus bill that has wide support from members of both parties and will end the practice of members of Congress owning and trading stocks once and for all," they concluded.

The Restore Trust in Congress Act would ban members of Congress, plus spouses and children, from trading individual stocks. It would give them 180 days to sell anything they hold and require divestment before newly elected lawmakers are sworn in.

When that bill was introduced in September, Jamie Neikrie, legislative director at the political reform group Issue One, said that "members of Congress have a responsibility to hold themselves to the highest ethical standards, and passing the Restore Trust in Congress Act is how Congress shows it's serious about restoring trust and integrity in government."

As Politico detailed Monday:

Johnson and GOP leaders have been searching for a legislative compromise to appease Rep. Anna Paulina Luna (R-Fla.) and other rank-and-file House Republicans, who have for months been threatening to launch a discharge petition effort to circumvent leadership and force a floor vote on a full congressional stock trading ban.

Luna, in a promising sign for Johnson, said in an interview last week she supports the current legislation pending before the House Administration Committee because it would force a "disgorgement" period.

However, even if the new bill is able to get through the Republican-controlled House, it would face a GOP Senate majority so narrow that at least some Democratic support is required to advance most legislation to a final vote.

Last July, Sen. Josh Hawley (R-Mo.) voted with all Democrats on the Senate Homeland Security and Governmental Affairs Committee to advance another bill that would bar federal politicians from holding or trading stocks. To win over Hawley, Democrats had to agree to a carveout for President Donald Trump. As Business Insider noted Monday, "It has yet to receive a floor vote."

Like the House Democrats, Christina Harvey, executive director of the progressive advocacy group Stand Up America, was critical of the lower chamber's GOP leadership on Monday, saying that "Speaker Johnson is trying to trick the American people into thinking House Republicans are actually doing something to stop corruption in Washington, but this proposal is a congressional stock trading ban in name only."

"If Speaker Johnson really cared about stopping members of Congress from using their offices for financial gain, he would bring the comprehensive, bipartisan Restore Trust in Congress Act to the floor," Harvey declared. "The American people should have confidence that their leaders are serving the public’s interests in every vote—not their wallets."

Campaign Legal Center vice president, general counsel, and senior director for ethics Kedric Payne similarly said that "any legislation that allows lawmakers to hold onto their existing stocks is too narrow to address Americans' real concern that elected lawmakers may make official decisions to benefit their pocketbooks instead of the public good. A bill that also bans trading by the president and vice president, meanwhile, is too broad because it undermines the chances of passing the reform voters care most about: stock trading by members of Congress."

"Thankfully, there is a proposal on the table that strikes the balance for this moment: the Restore Trust in Congress Act," Payne added. "This consensus legislation was crafted during months of negotiations by lawmakers on both sides of the aisle. It has more than enough support to pass, and it would make a significant improvement to our nation’s government ethics laws. Campaign Legal Center calls on Congress to return its focus to this bipartisan bill and set an example for the other branches of our government."

This article was updated with comment from Stand Up America and the Campaign Legal Center.