Congress, which has a history of exempting itself from laws that others must follow, may finally agree that it shouldn't be involved in insider trading. But don't be surprised if members of Congress try to dodge insider trading laws by creating a loophole.
It will take sustained public pressure to make sure Congress actually passes a bill with tough insider trading restrictions. On Thursday, the House voted 417-2 to prohibit members of Congress from trading stocks and other securities, based on confidential information they glean as lawmakers.
It says a lot about Republicans and Democrats in Congress that we have to have a law specifically banning them from insider trading. They should be banned under the general insider trading laws that prohibit everyone else from using insider knowledge to profit from stock trades.
But we have to have a law for Congress to do the right thing.
The STOCK (Stop Trading on Congressional Knowledge) Act would require members to disclose stock and bond trades within 45 days. The Senate agreed to those changes by a 96-3 tally on Feb. 2.
That level of bipartisan agreement in today's Washington is remarkable by itself. That's what happens when there's so much public outrage at what members of Congress can get away with. Similar legislation had languished for years until a "60 Minutes" report in November started a media avalanche. President Barack Obama joined the bandwagon in his State of the Union address last month, demanding that Congress pass the bill.
The Senate bill is much stronger and far preferable to the House version, however. Citizens for Responsibility and Ethics in Washington goes as far as to call the House measure a sham.
Significantly, the Senate legislation would make it easier for federal prosecutors to go after public corruption, in part by closing loopholes created by recent court decisions.
The Senate bill would restore provisions that were essential, for instance, in prosecuting the Jack Abramoff lobbying scandal, says Melanie Sloan, executive director of the ethics watchdog group. Abramoff, who took $20 million from Indian tribes and wined and dined lawmakers and government officials, was the star witness in the corruption case that led to the convictions of Rep. Bob Ney of Ohio and some 10 other officials, and helped force the retirement of then-House Majority Leader Tom DeLay of Texas.
GOP leaders left out the public corruption provisions, even though they were approved unanimously by the House Judiciary Committee in December.
There's another major difference: The Senate bill would force political intelligence consultants -- who troll Washington gathering information to help hedge funds, mutual funds and other investors -- to register as lobbyists and report their activities.
The House bill meekly calls for a study of the issue. Republican Sen. Charles Grassley of Iowa, who wrote the lobbying provision in the Senate bill, called it "astonishing and extremely disappointing that the House would fulfill Wall Street's wishes by killing this provision." You might think that's awfully cynical. But given the track record of Congress, you wouldn't put it past them. That's all the more reason to contact your representatives and put some fear in them.
Editorials are the opinion of the Merced Sun-Star editorial board. Members of the editorial board include Publisher Eric Johnston, Executive Editor Mike Tharp, Online Editor Brandon Bowers and Guest Editor Jessica Boerner-Grissom.
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