The investing practices of Capitol Hill lawmakers — and the relation to their day jobs — have come under scrutiny before.
A massive study by four university researchers released in 2011 studied 16,000 stock transactions made by approximately 300 House members from 1985 to 2001. The congressmen were able to generate what the researchers deemed “significant positive abnormal returns,” beating the market by about 6 percent annually.
A similar study found that U.S. senators did even better — beating the market by 10 percent a year on average.
In part in reaction to the investment numbers, Congress passed and President Obama signed the so-called Stock (Stop Trading on Congressional Knowledge) Act in April 2012, prohibiting the use of “nonpublic information” for private profit, including insider trading, by members of Congress and other government employees.
“The powerful shouldn’t get to create one set of rules for themselves and another set of rules for everybody else,” Mr. Obama said at the signing ceremony. “If we expect that to apply to our biggest corporations and our most successful citizens, it certainly should apply to our elected officials.”
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Valerie Richardson covers politics and the West from Denver. She can be reached at firstname.lastname@example.org.
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