House Minority Leader Kevin McCarthy (R-CA) may ban lawmakers from holding or trading stocks if he wins the speaker’s gavel in November, a report suggests.
McCarthy’s plan of banning members like House Speaker Nancy Pelosi (D-CA) and Rep. Dan Crenshaw (R-TX) from trading stocks is still under development and undefined as to how far-reaching the limitations would be, Punchbowl News reported.
“One idea would be to force lawmakers to hold only professionally managed mutual funds. Another proposal the GOP leadership is considering would bar lawmakers from holding stocks in companies or industries their committees oversee,” the news site reported. “Other members have advocated for mandatory blind trusts for lawmakers’ holdings.”
Lawmakers are currently permitted to trade and hold stocks with a limited degree of transparency under the STOCK Act. But with a significant majority of Americans skeptical of lawmakers trading stocks based on information not widely known outside Congress, a movement may be afoot to ban congressional members from cashing in.
The largest congressional offenders of stock trading are reportedly House Republicans, though Speaker Pelosi is one of the wealthiest members of Congress in connection with her husband, Paul, who engages in extremely profitable tech stock trading.
In July, the Pelosis earned $4.8 million dollars trading tech options. Yet Speaker Pelosi claims she does not own any stocks her husband trades.
McCarthy’s consideration of further limiting lawmakers’ ability to game the system may be due to the public polling on the issue.
Seventy-six percent of voters contend lawmakers and their spouses have an “unfair advantage” trading stocks, according to a December Trafalgar Group poll. About five percent believe it is “perfectly fine” for lawmakers to trade stocks.
The chances of stricter stock trading rules depend on whether Republican retake the House in November. So far, 26 out of 37 retiring members are Democrats, a sign McCarthy may have a chance to enact reforms.
Follow Wendell Husebø on Twitter @WendellHusebø
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