| Speaker | Time | Text |
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unidentified
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Information for every House and Senate member of the 119th Congress. | |
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| Stock trading and efforts in Congress is the reason our next guest is here, Dave Leventhal investigative journalist. | ||
|
unidentified
|
Hello. | |
| Hey, great to be with you. | ||
| You have been following this whole thing. | ||
| The Senate is the latest to take up this issue. | ||
| Explain what's going on. | ||
|
unidentified
|
Absolutely. | |
| And there have been a number of bills introduced not only this year, but the past several years to do exactly this: ban lawmakers and their spouses and dependent children in some cases from buying and selling stocks, which I should note sometimes conflict with the official duties that members have. | ||
| For example, people serving on the House Armed Services or Senate Armed Services Committee, trading stocks in Boeing and RTX and other defense contractors, healthcare, technology. | ||
| The list goes on and on. | ||
| But this latest bill, it's called the Honest Act. | ||
| Had to write this down because Congress loves its acronyms. | ||
| It's the Halting Ownership and Non-Ethical Stock Transactions Act. | ||
| And this was a piece of legislation that was supported by Democrats primarily, but Josh Hawley, a Republican, was the real instigator. | ||
| He joined with Democrats last week to advance this bill over the objections of some key Republican senators, including Rick Scott from Florida and Bernie Moreno from Ohio. | ||
| But I should note, too, that this is a weird bipartisan coalition on this particular topic, which makes it fascinating. | ||
| And even Donald Trump, although he was pretty angry at Josh Hawley for teaming with Democrats, has said in principle that he's open to a bill like this passing along with Hakeem Jeffries, the minority leader in the House, and wait for this, Mike Johnson, the Speaker of the House, too. | ||
| So there is possibility. | ||
| Bipartisanship. | ||
| Whoever thinks it. | ||
| Honest Act, there's three elements. | ||
| It would first ban members of Congress, the president, the vice president, from buying covered assets immediately after enactment and selling covered assets 90 days after. | ||
| Let's start with the covered assets. | ||
| What's that? | ||
|
unidentified
|
Yeah, covered assets would be stocks ostensibly that members could buy and sell. | |
| And I should note, too, that the presidential aspect of this is highly controversial. | ||
| You have some of these bills, including the Honest Act, that were focused on Congress alone, but there was language inserted into this bill that would apply to the president and apply to the vice president, although in a compromise, going forward, at least at this point, it wouldn't apply to the president and the vice president until Donald Trump and JD Vance have finished their current term. | ||
| So it would be basically kick down the road a little bit to 2029, although all of this is open to amendment. | ||
| And should also note, too, Pedro, that Jon Thune, the Senate Majority Leader, may or may not decide to even bring this for a vote on the House. | ||
| I was going to say, how did all those parties involved agree on that, though, when it comes to letting the president, the vice president, at least off a little bit on this? | ||
|
unidentified
|
Yeah, and this is part of the negotiation and the controversy that hit there. | |
| Donald Trump, obviously, not happy with the idea that he would be limited in any way, shape, or form in this current legislation. | ||
| Expect as this goes forward, or for that matter, any bill that might come up in the House, as that goes forward, that Donald Trump, shocking here, will be playing a front and center role in the debate over the extent of this legislation and ultimately law were it to come to pass. | ||
| One other element required elected officials, their spouses, dependent children to divest covered assets beginning at the start of the next term in office, and then it would increase penalties for violations of the Stock Act disclosure requirement. | ||
| Can you expand on those? | ||
|
unidentified
|
Yeah, and that's been a huge issue of all of this. | |
| Much of the reporting that I've focused on in the past several years has come on the violation front. | ||
| There's an existing law. | ||
| It's called the Stop Trading on Congressional Knowledge Act. | ||
| It was passed by Congress for Congress in 2012, and it was supposed to be an elixir to these potential conflicts of interest, be them real or perceived, and also to insider trading or the specter of insider trading that comes when you're a member of Congress, you are privy to a lot of information and knowledge that the general public might not be. | ||
| And whether indirectly or directly, you're using that information to inform your stock trades or maybe your stockbroker or financial advisor making trades on your behalf. | ||
| But so many members, Republicans and Democrats, have violated this, literally dozens, including many this year, more than 10 so far that we've had. | ||
| And it ranges from Neil Dunn, a Republican of Florida, to Debbie Wasserman Schultz, also a Democrat from Florida, and many, many in between. | ||
| So people continue to violate this. | ||
| And in fact, as this debate was happening last week about the Honest Act, Mark Wayne Mullen, the senator from Oklahoma, Republican, I reported in Notice, the nonprofit news organization, that he had violated the Stock Act by failing to disclose. | ||
| He was two years late a series of bond and stock trades that when he added all up was into the hundreds of hundreds of thousands of dollars in value. | ||
| So this is something that a lot of people always say, hey, this is a false equivalency between Republicans and Democrats. | ||
| I am here to say that this is a true equivalency in the way that they're violating it. | ||
| The caller that previously brought this up before you came on talked about Nancy Pelosi. | ||
| If I read it correctly, Nancy Pelosi was the full, it was focused on this Honest Act. | ||
| In fact, it was named after her in some cases, but that changed. | ||
| Can you explain that? | ||
|
unidentified
|
Yeah, I had to write this one down too. | |
| This was the Pelosi Act, the Preventing Elected Leaders from Owning Securities and Investments Act. | ||
| This was brought forward by Josh Hawley himself as standalone legislation. | ||
| It was superseded by the Honest Act. | ||
| But Nancy Pelosi has been sort of the avatar for stock trading, at least on the right and on the Republican side. | ||
| Her husband trades tens of millions of dollars, Pedro, every year in stocks and stock options. | ||
| Nancy Pelosi has long said, hey, I'm not the one doing the stock trading. | ||
| I don't tell my husband to do this or that. | ||
| But that has not washed with many Republicans. | ||
| Also worth noting, too, that Nancy Pelosi was a strong, strong voice, at least initially back in 2021, when she was asked about this after a major project that Business Insider did that I was part of. | ||
| And that was something where she basically said to paraphrase, hey, look, this is a free market economy. | ||
| Anyone should be able to trade and participate in that economy as they see fit. | ||
| She caught a lot of heat, both from the far left and the far right. | ||
| And that in a way was sort of the impetus for this ongoing debate that we have had ever since. | ||
| She has since come around to support the Honest Act, but she also too kind of blocked a bill and almost torpedoed a bill in 2022 that Democrats had offered up. | ||
| So Republicans have an opportunity here in a way to say, hey, look, we're going to do something with this that Democrats weren't either able to do or willing to do when they had power in either the House or the Senate. | ||
| Has there ever been a specific instance where a legislator had inside information, made trades on it, and could be proved definitely that they benefited from it? | ||
|
unidentified
|
No, in short. | |
| And this is one of the hardest things to do because in essence, you have a situation where you might think that a lawmaker is using inside information, but how do you prove it? | ||
| And do you have enough evidence for, for example, the Department of Justice to get involved and prosecute such a crime? | ||
| There were some investigations that happened, and this was particularly the case at the beginning of the COVID-19 pandemic when you had several senators, the late Diane Feinstein. | ||
| Kelly Leffler, who's now the administrator of the Small Business Administration, and a couple of others who had made some very curiously timed trades with highly pandemic-sensitive stocks and were investigated for using information about the COVID pandemic to inform those stock trades that they made, in some cases, into the hundreds of thousands and millions of dollars. | ||
| They were all cleared. | ||
| The investigations were dropped. | ||
| But that was kind of part and parcel of that point that it is incredibly difficult to truly prove and get a conviction on something, although we can see from data and available information that there are some conflicts of interest, even if they do not rise to the level of current illegality that are at least at their face problematic in the eyes of many, many Americans who, when you poll people and many polls have been done, there's sometimes three out of four Americans who say this should be banned. | ||
| It's crazy that it's even legal at this point. | ||
| So that's coming from Republicans, Democrats, and Independents all at the same time, almost across the board. | ||
| The Honest Act passing out of committee. | ||
| What are the next steps from here? | ||
|
unidentified
|
Well, again, John Thun is going to be front and center as to whether he wants to bring this to the floor for a vote. | |
| And at that point, the prospects are curious as to whether there are going to be enough Republicans to go forward and basically team with Josh Hawley and what would probably be most Democrats in passing this. | ||
| So expect that there could be a pretty strange bipartisan coalition that would be coalescing around this bill. | ||
| We've also seen this in the U.S. House of Representatives where you have, for example, Chip Roy, one of the most conservative Republicans in the U.S. House, and Alexandria Ocasio-Cortez of New York, one of the most liberal, basically singing from the same songbook when it comes to a stock ban bill. | ||
| With those Republicans that may hesitate on supporting it, what would be the justification if they express concerns about the legislation specifically? | ||
|
unidentified
|
Yeah, well, some of them, and Rick Scott was a good example. | |
| He talked about this in committee last week saying, hey, it should not be illegal to be wealthy. | ||
| And he's one of the most wealthy senators or members of Congress writ large who is just basically saying this is not, this is not American. | ||
| And this is not something that we should limit members of Congress from doing. | ||
| Others may have particular concerns with details. | ||
| How far this goes. | ||
| Does this involve the entire executive branch? | ||
| There's been talk about involving the judiciary, the Supreme Court specifically. | ||
| So you may have some riders and some amendments that are kind of floating around and flying around and being debated as this debate goes forward. | ||
| DaveLeventhal.com is your website. | ||
| What kind of reporting can people find? | ||
|
unidentified
|
A lot of investigative reporting, very much at the intersection of business and money and politics and policy. | |
| And you can find my work at Notice, where I'm now a contributing editor. | ||
| Dave Leventhal, thanks for the time. | ||
|
unidentified
|
My pleasure. | |
| Thank you. | ||
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