“The potential for the reduction of conflicts of interest, or the appearances of them, is all for the good.” –Ron Lieber, NYT financial journalist
Lieber had an interesting article in the NYT over the weekend. He believes that members of Congress should sign a pledge that they can’t own individual stocks. Up until 2012, it was not illegal for members of Congress to trade on insider information. Insider trading was illegal for the rest of the world since 1934. It only took Congress 78 years to catch up.
The pass of the STOCK act in 2012 was a step in the right direction but probably doesn’t go far enough. Banning members of Congress from being able to own individual stocks would go a long way in correcting any existing improprieties.
Lieber’s article goes on to explain how banning individual stock ownership would also increase the odds of long-term financial security over stock trading and trying to beat the market. Time to Take a Pledge: No Stocks if You’re a Member of Congress. Sounds like a win win to me.