Inside Trading: Congress for saleI have mostly stopped reading political news because I get so frustrated by all of it. This is a perfect example of how politics in this country now works. It is no wonder that nobody has any faith in anything with such a corrupt government doing its best to line it's own nest at the expense of the taxpayers.
SEATTLE POST-INTELLIGENCER EDITORIAL BOARD
Here's a little history to consider.
Congress enacted the Securities Act of 1933, which required registration of publicly traded companies -- making more information open and available to the public. A year later, Congress added more protections for investors. One of those provisions made it illegal to trade stock by corporate insiders who were privy to special information that could help or hurt a stock.
After this generation's corporate scandals, Congress passed Sarbanes-Oxley in 2002 to improve corporate governance and audit independence. But one of the measures added reporting requirements and tougher standards for insider trading.
Unfortunately, Congress forgot itself. It remains perfectly legal for a member of Congress to buy and sell stocks based on information that's not available to the public. Last year it was reported that a "political intelligence" firm tipped off its clients to an undelivered speech by Senate Majority Leader Bill Frist on asbestos liability. The information was profitable to those in the know.
"This is simply wrong that members of Congress can exchange information ... and get rich on it," says Rep. Brian Baird, D-Wash., who is co-sponsor of a bill to prohibit insider trading by members of Congress and their staffs.
Baird will report to a congressional committee today on the proposal -- and is optimistic. "When people hear about it, on both sides of the aisle, they think this is something that ought to be fixed."
We think Baird's right. Even if a congressional insider trading ban comes seven decades too late.
There is one thing I would like to know though. I have often heard that when Senators and Congressmen retire, they retire with 100% pay, not a portion of the pay they receieved, like the rest of the country. I'd really like to know if that is true. Does anyone know for sure and can you show me where the proof of that would be located? I would prefer to think that this is just another "urban legend," but I have a bad feeling that its true.