Moving quickly on at least a part of President Obama’s State of the Union program, Senate Democrats will hold their first vote Monday on a bill to prevent members of Congress from profiting from inside knowledge gained through their official duties.
But the legislation stops short of Mr. Obama’s call to ban lawmakers from voting on any legislation in which they have a financial interest.
“The American people need to know that their elected leaders play by the exact same rules that they have to play by,” said Sen. Kirsten E. Gillibrand, New York Democrat.
“They also deserve the right to know that their lawmakers’ only interest is what’s best for the county - not what’s best for their own financial interests.”
Questions about members of Congress using insider knowledge have risen since a CBS “60 Minutes” report that pointed out members of Congress have appeared to benefit from being in meetings where the fate of the economy was discussed, or where lawmakers plotted strategy on bills that could change an industry.
At the time, top leaders seemed cool to legislation, but pressure grew and by Tuesday night, Republicans and Democrats applauded when Mr. Obama made his call for action.
Senate Democrats are moving faster. Majority Leader Harry Reid on Thursday brought the bill to the chamber floor and set up an early test vote for Monday, though it still is unclear what sorts of amendments Mr. Reid will allow to be debated.
The bill makes it illegal to use nonpublic information for personal gain. It would apply to lawmakers and to congressional staffers.
The legislation also updates reporting requirements, requires that congressional financial disclosure forms be made available online and directs Congress‘ investigative and research branches to report on how much political intelligence influences the markets.
The “60 Minutes” report suggested that an entire industry has arisen around selling political tidbits to traders who make strategic investing moves based on them.
In Tuesday’s State of the Union address, Mr. Obama also called for Congress to “limit any elected official from owning stocks in industries they impact.” But the bill before the Senate doesn’t do that, and some aides said that’s an impossible bar to achieve because Congress‘ reach touches on so much of the economy.
Still, the White House praised the bill that will come before the Senate.
“This bipartisan legislation will help limit the corrosive influence of money in politics and restoring the American people’s trust in Washington,” press secretary Jay Carney said in a statement.
“Members of Congress should not be able to trade stocks based on nonpublic information gleaned on Capitol Hill nor should they be able to own stocks in industries they impact. We believe this is an important first step to prevent members of Congress from profiting from their positions and call for swift passage,” he said.