YOU DECIDE: Should Members of Congress Be Allowed to Trade Stock?

In April 2012, Congress passed the Stop Trading on Congressional Knowledge (STOCK) Act by a large majority of both Republicans and Democrats. The STOCK Act required members of Congress and their spouses and dependent children to publicly (and promptly) reveal when they have bought or sold shares of stock in a company. Recently, however, some legislators have proposed bills that would go even further and prevent members of Congress from participating in the stock market at all. Some of the bills go further still, and ban stock market trading not just for lawmakers, but for their spouses and family members as well.

So, YOU DECIDE: Should members of Congress be allowed to trade stocks?

NO

• The laws that members of Congress pass could directly impact companies that the lawmakers might own shares in. In other words, members of Congress could pass laws for their own personal financial gain. This leads to a conflict of interest.
• The STOCK Act has been ineffective. For example, in 2021, the Campaign Legal Center discovered that 54 members of Congress did not accurately report their stock trades. The current penalty for failing to accurately report stock trades is only about $200, and no one has ever been prosecuted under it. So there is little incentive to follow the rules.
• It is unethical for members of Congress to trade stocks because they have access to confidential information. For example, some lawmakers made huge financial gains during the COVID-19 pandemic by buying and selling stocks in medical and tech companies that produced ventilators, vaccines, drugs, and other treatments.

YES

• The United States has a free market economy. Everyone, even members of Congress, should be allowed to participate freely in the system.
• Laws banning members of Congress from participating in the stock market would treat legislators unfairly. Presidents and Supreme Court justices can also directly impact companies with their actions, and yet they are still permitted to trade stocks.
• Insider trading is already a serious federal crime. Instead of banning lawmakers from stock trading, it would be fairer to impose harsher penalties in the STOCK Act for failing to report it accurately.