OPINION: This article may contain commentary which reflects the author's opinion.
Missouri Republican Sen. Josh Hawley has introduced the PELOSI Act, or officially the Preventing Elected Leaders from Owning Securities and Investments Act, that would prohibit members of Congress and their spouses from holding or trading individual stocks. The bill already has support from many House Democrats.
“As members of Congress, both Senators and Representatives are tasked with providing oversight of the same companies they invest in, yet they continually buy and sell stocks, outperforming the market time and again. While Wall Street and Big Tech work hand-in-hand with elected officials to enrich each other, hard-working Americans pay the price. The solution is clear: we must immediately and permanently ban all members of Congress from trading stocks,” Hawley said.
“Members who violate the requirements will also lose the ability to deduct the losses of those investments on their income taxes. The ethics committees of Congress may levy additional fines and will publicize violations,” as per a press release.
“The PELOSI Act will impose the prohibition on lawmakers during their tenure in office but will exempt holdings in diversified mutual funds, exchange-traded funds, or U.S. Treasury bonds. It will give members of Congress and their spouses six months, upon assuming office, to divest any prohibited holdings or place those holdings in a blind trust for the remainder of their tenure in office,” Benzinga reported.
Members of Congress and their spouses shouldn’t be using their position to get rich on the stock market – today l’m introducing legislation to BAN stock trading & ownership by members of Congress. I call it the PELOSI Act pic.twitter.com/aIXNwSnTvW
— Josh Hawley (@HawleyMO) January 24, 2023
Last month, GOP Rep. Chip Roy sent a letter to then-House Speaker Nancy Pelosi over her lack of urgency to hold a vote on the STOCK Act, a separate bill that was similar to Hawley’s PELOSI Act.
“As you are aware, the House floor schedule this week contains the ‘Possible Consideration of Legislation Related to the STOCK Act.’ I am glad to see the House finally taking up the idea of reforming policies related to Member stock trading. However, as one of the original sponsors of reform language — notably introducing HR336, the TRUST in Congress Act, some 2 years ago with my Democrat colleague from Virginia, Abigail Spanberger — I was interested to see the ‘final’ language via Jake Sherman’s Twitter account last night,” Roy wrote.
“The state of the House of Representatives is absurd — and that is not a partisan statement,” he continued. “Like virtually every other legislative idea or proposal, we have not had any robust debate on reforms to member stock trading or even a ‘Member Day’ hearing that would allow each member of the House to air individual views on the matter. This complex issue requires thought, debate, amendment, and a full airing in committee to build as much bipartisan agreement as possible rather than the normal cram-down from the top that permeates literally everything we do.”
Nancy Pelosi had originally directed the House Administration Committee to draft legislation back in February, but the release of that draft this fall came at a bit of an awkward time. Just weeks before, she’d faced harsh criticism when her husband, Paul, a venture capitalist, exercised his call options and purchased shares in Nvidia, a manufacturer of graphics cards.
It was right before the Senate was expected to vote on a bipartisan bill that would see domestic chipmakers get a $52 billion subsidy, and the move received significant blowback. That bill ultimately passed in July and, amid the scrutiny, Paul Pelosi sold his holdings in the semiconductor manufacturer at a six-figure loss.
Speaker Kevin McCarthy previously said there will be an investigation into the Pelosis stock trading.
“I would look through it,” he said of the Democrat proposal to ban stock trading for spouses of Congress members. “What I’ve told everybody is we will come back, and we will not only investigate this, we will come back with a proposal to change the current behavior.”
“Her husband can trade all the way through, but now it becomes a crisis?” he said. “I think what her husband did was wrong.”
“I think we need to bring trust back to this institution,” he added. “I think we have to do a thorough investigation and look at what is the proper role for members of Congress and what influence they have, and I don’t think the proper way to do this is Nancy Pelosi writing the bill because we have proven that she can not do that.”