On Wednesday, a key Senate panel approved a bill that would ban lawmakers from trading stocks.
The Senate Homeland Security and Government Affairs Committee approved the legislation — known as the Ending Trading and Holdings in Congressional Stocks (ETHICS) Act — by an 8-4 vote.
Republican Sens. Rand Paul of Kentucky, Ron Johnson of Wisconsin, Mitt Romney of Utah, and James Lankford of Oklahoma voted against it.
“The public doesn’t think we should profit from having information that they don’t have, and we shouldn’t” Democratic Sen. Jeff Merkley of Oregon, one of the key sponsors of the bill, told reporters in his office on Tuesday.
It’s a sweeping bill — but it wouldn’t take full effect until 2027 Under this bill, members of Congress — along with the President and Vice President — would be banned from purchasing stocks and cryptocurrencies beginning 90 days after the bill’s signed into law.
Then, on March 31, 2027 — two and a half years from now — a more complete ban takes place. Those same politicians, as well as their spouses and any dependent children, would have to sell off all of their stocks within 120 days after that.
It’s actually a pretty good plan. Politicians are relatively wealthy and if they all had 30 days to stop investing it’d likely cause a sell panic in the market - the immediate cessation of new investing would kill most the inside trading and then the gradual two year period to uninvest lets politicians dodge being forced to sell during a market downturn.
I also like that it covers spouses and children but there would ideally be provisions for punishments if the lawmaker leaked privilege to a third party similar to other insider trading laws - it shouldn’t be possible to launder your insider trading through a broker or neighbor.