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Congress Needs to Stop Day Trading, Says Sen. Mark Warner (bigtechnology.substack.com)
240 points by kantrowitz 13 days ago | hide | past | favorite | 162 comments

Members of Congress make ~$174k/yr. [1]

It will be an unpopular opinion, but I believe that we should pay better (and demand better) for a job with that much responsibility. Otherwise, a congressperson will be forever tempted to align their incentives with service to causes other than their electorate.

I'm fairly certain we should be paying our elected officials at least as much as our football coaches.

[1] https://www.senate.gov/artandhistory/history/common/briefing...

It has been proven multiple times, that already very well paid company managers, will accept bribes for small amounts of money and petty motives.

Integrity is not connected to how well someone is paid. Reckless behavior for minor motives that makes people risk careers of years, family responsibilities, seems the norm for some individuals.

I collect these cases, as they fascinate me on what they say about human nature.

I am still trying to find out if these individuals end up on those roles because of that unhinged behavior, or getting into these roles is what intoxicates their moral judgement, despite many years of successfully running professional careers.

In other words, your strategy will not work.

A fairer framing would be, “Does increasing salaries of politicians decrease corruption, increase it, or make no difference whatsoever due to other factors?”

I suspect it helps more than it hurts since it seems to be a successful policy in Singapore. I’m skeptical decreasing the salaries would help because competent people would work elsewhere.

Denmark and New Zealand are perceived as some of the least corrupt nations, at least in perception, and politicians do not earn anything close to US politicians.

I think it's fair to look to other countries for possible outcomes to consider, but I also think the specifics of how these things play out would vary a lot country to country.

you can't compare NZ and DK with US legislative member. The effect of their policy making in terms of nominal number ($$) is multiple order of magnitude different.

I agree with the OP, where in nuance, paying policy maker more would more or less reduce corruption. It doesn't guarantee that it'll work but at least worth the try, cost wise.

Just like in sports gambling, one of the most efficient way to tilt the favor to your bet is pay the arbiter.

But they should be paid fairly commensurate with their responsibilities. Some of them with spine will actually be demotivated to do corruption.

I would say I've found myself abutting roles that I was uncomfortable to take due to risk aversion. I don't have debts to pay either. Sometimes you want a motivated person, sometimes you want a you-name-it.

Can you share some of these cases or research?

We had a governor selling Obama’s senate seat for a garage sale discount.

The problem with this assessment is that it will never be enough. There is always more to make. For you. For your partner. For your kids.

Many of us here are in software development and make more than $174K a year. That's great. However, even if we were paid $225K, but found an easy way to make $3 million a year, many of us would be tempted to go for the millions.

Many state governments don't pay much or anything at all to their state legislators. Which is a great way to make sure that only rich well connected people can afford to serve.

Is being a legislator a full time job in the US? As in, you are legally not allowed to also have another job?

(It isn't in my country. You can be a pilot, an actor or an engineer and still be a legislator)

To give an example, that may not representative: the Texas legislature meets for 140 days, every 2 years. The governor can call special sessions that are up to 30 days in length.


So at least in Texas it does not have to be a full time job.

But neither is it a job that most people could afford not working for that long a time.

For the jobs I mentioned above, it would be very easily possible: Actors, sportsmen and pilots

That's not how markets typically work. There are million dollar jobs in software, we are just not good enough to get them but some people are. If congress' salaries were higher more of those people who currently have better paid opportunities would compete with them rather than having the same quality people but just better paid.

> There are million dollar jobs in software, we are just not good enough to ...

Or we didn't hear about them, or the candidate was chosen via networking rather than advertising. There are a million reasons that this is not a perfect market.

My experience in fintech has taught me that people working for more money are not necessarily any better at their jobs, in fact a lot of them are worse, they just happen to know the right people.

It's not a perfect correlation but it's certainly easier to find better candidates if you can offer them more than they'd get elsewhere.

> It's not a perfect correlation but it's certainly easier to find better candidates if you can offer them more

Ah, but that wasn't the claim - the claim was that people who get the $200k jobs are not good enough to get the $1m jobs. My counter-claim is that the people who are actually in the higher paying jobs are not always better.

You may be able to attract better people by offering more, but that's not necessarily relevant to the hiring processes that result in the people who have those $1m jobs getting to where they are. I've seen flat-out useless sycophants holding on to high paid roles because of basically office politics and industry connections.

I’m sure some million dollar software jobs get given out to connected idiots, but I don’t think it’s most of them. When I’ve worked with those kinds of people (high level engineers at top companies), they tend to be very skilled.

I've seen Senior Engineers who probably make $300K+ steal and bring home whole pizza pies from "Pizza Night For Late Workers". It doesn't matter how much you make, if they are fundamentally dishonest and see $100 sitting on the floor they're going to take it.

EDIT: Correction--engineers, didn't actually see managers do it.

This is bizarre. I’ve had managers that used to bring donuts on their own dime for the whole team. Are you sure they’re stealing or just taking home a left over pizza?

No they are just dishonest:

"...This is what Steve Jobs did about the fact of how he tricked his best friend into working all night long for several days and then cheating him out of his paycheck. This proved to be only the first offense in a long litany of his penchant for pettiness and pointless cruelty.

The friend that I am talking about is Steve Wozniak, him and Jobs were working at Atari, one of the first video game consoles which revolutionized the video game market. The owner of Atari at the time was its actual founder by the name of Nolan Bushnell.

The first game that came out was “Pong,” a classic which many people remember. Due to its high success, Bushnell thought of making a sequel that would be only a single-player and call it “Breakout” in 1975.

...For this project, Bushnell was thinking of tasking Steve Jobs to be in charge and take care of the project. Jobs was considered (at the time) a low-level Atari technician with huge potential. As this game was expected to be much better than its predecessor, Jobs recruited Steve Wozniak, who was known on the market as the better engineer. ..

Jobs and Wozniak had been friends for quite some time at that point. They both were working towards the Apple 1 which would follow to become the most iconic computer around the world for four long years so they got to spend a lot of time together.

The way that Atari worked was by offering a monetary bonus for every chip fewer than fifty that was used when building a game. Wozniak was ecstatic when Jobs asked him to help with this big project.

This is when Jobs started to lie to Wozniak in order to use him for his expertise. He told Wozniak that the deadline was four days and that he had to use as few chips as possible. The truth is that Jobs was given a whole month for this project, not four days.

Jobs never told Wozniak about the bonus for using fewer chips and the four-day deadline was self-imposed by Jobs, as he needed to get back to his commune farm to help bring in the apple harvest. It is imperative to mention (for those who are not aware) that Steve Jobs came from a very poor background.

Wozniak was working for Hewlett-Packard at the time as well, so he had to balance his main job as well as this project. So he would end up going to his job in the day time and spending most of the night working on “Breakout”. The only thing that Steve did was implementing the required chips, making sure that there were less than fifty chips. Their herculean efforts succeeded, as they finished the game in four days and only using forty-five chips.

When payday came, Steve Jobs only gave Wozniak half the pay, he kept the rest of his pay as well as the bonus for himself. Wozniak only found out about this ten years later..."


Many of us is an overstatement. The jobs threads are always full of people making way less, have you not seen?

Regardless of their pay, a congressperson will be tempted to align their incentives with service to causes other than their electorate. Plus, people who just want to make a lot of money (instead of serve their country) would be tempted to run for congress to receive "football coach level pay".

It makes sense to pay them a high enough wage so (lack of) money doesn't become a worry in their life, but incentives get borked beyond that.

What worries me more is the fact that they are guaranteed that same wage for the rest of their life after serving in Congress.

Congressional pensions: https://foxx.house.gov/legislation/fact-or-fiction-members-a...

Looks like one must serve at least 5 yr to get them (so House members aren't automatically in, but Senators are).

Hell, maybe even it would be okay to have lack of money become a worry in their life- potentially would help them understand a significant portion of their electorate better. So many of them are out of touch as it is in regards to financial security, the prices we pay for things, etc.

My rule of thumb is that for decision-making roles, you want financial compensation to at least match the 'status compensation' (respect, status, etc). When the vast majority of the role's compensation comes via the _prestige_ of being a member of congress, you're bound to get weird results.

I suggest that you spend some time at certain popular bars inside the beltway where you can hear drunk staffers flapping their lips. You will quickly learn that our elected representatives have virtually no responsibility whatsoever beyond maintaining the charade that the USA is in any way a democracy.

The schoolhouse rock look at me I’m a bill thing isn’t even wrong anymore. There’s not a single “legislator” who actually writes legislation anymore. They literally just broker their signatures (those brokers are called lobbyists) to the parties that actually write the laws. It’s a painful bandaid to rip off, but that’s how the system actually operates.

>I suggest that you spend some time at certain popular bars inside the beltway where you can hear drunk staffers flapping their lips. You will quickly learn that our elected representatives have virtually no responsibility whatsoever beyond maintaining the charade that the USA is in any way a democracy.

As you seem to be a beltway insider with connections, and not just making up bullshit to sound cool, which bars specifically would you suggest?

Like most business district bars, you would go to the bars close to where they work after work hours for 'happy hour', sit and listen. Not much special research required.

I heavily disagree. We are already in a situation were poor people don't even fucking bother to vote anymore because none of the politicians live on the same planet as they do.

None of these millionaire douchebags are relatable at this point.

I think the problem is that if we don't pay them, someone else will. And the "someone else" always attaches strings.

Nancy Pelosi, as an example off the top of my head, has a net worth of 100 million dollars. How much more should we pay her to stop stealing via insider trading?

In my view there should just be a law that says congresspeople can't have their net worth increase by more than their after tax salary period. Then, when we find one of them doing corrupt things we should send them to prison.

Even if we pay them, someone else still will. What makes you think that someone earning a lot of money is magically going to stop looking for even more money?

No. Hell no. Elected office is a sacrifice and a duty. It is not a way to make a living. Thats how you end up with dinosaurs working those halls for 68 years.

I have a better idea.

1)Fix salary at 2x poverty wage.

2) make house members 1:50,000 representation to their county (yes that means the house would explode to 8000 elected officials)

3) tax any earnings above their pre-office historical income avg, at say 98%. No ones lives off the taxpayer and no ones lives off favors given.

If they want to serve. They serve. The country would be far better off if congress shut down because they have DAY jobs to perform to keep their families fed.

If they cant make ends meet with their basic salary, they dont know sacrifice. If they dont know sacrifice shouldn't be running for office.

Stop paying for busy bodies and start electing hardworking, everyday americans

That's a great way to get corruption. Relying on independently wealthy people to sacrificially serve their country is not a reliable way of getting good quality talent.

My father spent some time in Bolivia some decades ago, and people in government were paid practically nothing. So there were a lot of bribes expected. And government officials got a fantastic exchange rate on Bolivios -> USD, which after you go through the cycle a few times, ended up with the government transferring the rate subsidy to the official.

China also doesn't pay its government officials much, and similarly, there is lots of corruption, which Xi Jinping spent several years cracking down on.

At the very least, it will be independently wealthy people (aka "elites") running the country, which brings its own set of problems.

GP's idea is extreme but Salary has nothing to go with corruption.

Politicians take money not to enrich their lifestyle, but to spend on getting elected/re-elected

Good quality talent?

Who are these people you are referring to as talented?

Do you mean talent to lie cheat and steal to the top? Kind of like a CEO?

We dont want talented people. Those belong in private industry where the metric for benefit of society is measured in hard currency.

We need people NOT talented in government so that the government does what its supposed to, and nothing else

If you're going to this extreme why not keep the system as is with the only change being that we no longer have elected officials but rather citizens of voting age chosen at random in much the same way a jury is selected to serve for a term? No competitions, no prestige, just a duty that people are randomly asked to do to serve their countries.

That sounds great but what natural random number generator will you use?

You can appreciate that jurt selection mostly works becayse the vast majoritt of events for which you are selecting is truly unimportant and thus with no value.

When you are making a selection that in fact provides well paid jobs, arent you making the selection process a highly sought target for criminals and thieves seeking power?

> If they cant make ends meet with their basic salary, they dont know sacrifice. If they dont know sacrifice shouldn't be running for office.

This is how you get bad candidates.

> If they dont know sacrifice shouldn't be running for office.

The poster might like AOC then. But something tells me they're not a supporter.

> Stop paying for busy bodies and start electing hardworking, everyday americans

TBH not sure i trust the "everyday american" to make really big complex decisions for a job. People who are familiar with such decision making process make a lot more and may not be "hardworking, everyday americans" to this poster.

> This is how you get bad candidates.

As per the known representative systems, there are countless ways to end up with bad candidates. I don't find this simplistic answer compelling. Notably, Plato (ie The Republic) suggested a relatively pious existence, to combat corruption.

What are these complex decisions?

Are politicians hired to debug code?

To send rockets to the moon?

To discover innovative ways to create profit?

No. Politicians only have 1 job. Protect the minority from the mob. To ensure neutral refereeing between consensual adults. Thats it. Its not rocket science.

In fact i venture that the avg rocket scientist would do a far worse job than your avg joe.

Avg joe understands the limits of his intellect and has a healthy respect for the wisdom of crowds.

The avg scientist has gone thru life being told how great they are, and now they think they know better than you and me.

Kissinger, McNamara, Wolfowitz, Fauci et al believe their hubris to be true and have caused major damage with their decisions.

There are tough decisions. Laws are long and complex, and can have huge second order affects that need to be thought out.

> Politicians only have 1 job. Protect the minority from the mob.

> has a healthy respect for the wisdom of crowds.

But is a politicians job to listen to the wisdom of the crowds?

> The avg scientist has gone thru life being told how great they are, and now they think they know better than you and me.

I sure trust a scientist more on their area of expertise more than I trust my own knowledge. I think people who rise to the top of their field generally believe their own hubris, not just scientists. Doctors think they can do anything, because becoming a doctor is so hard and well rewarded, engineers think they can solve anything because an engineers job is to solve (a specific subdomain of) things.

Whenever an engineer tells me an issue is simple and they have the answer, if it's not their field, then they don't. This doubly applies to comments on HN, which have already solved economics, politics, and healthcare, just to name a few.

> make house members 1:50,000 representation to their county (yes that means the house would explode to 8000 elected officials)

I disagree with rest, but something along these lines does seem like a good solution.

As a random bit of trivia, the original proposal was for a 1:40,000 representative ratio, and the only opinion George Washington expressed the entire time he chaired the Constitutional Convention was to change the ratio to 1:30,000.

Why sacrifice yourself before your political career ended? Why not do it afterwards with extremely high capital gains and income taxes (100% tax for anything above $200k) for retired politicians?

I think i was misunderstood.

What you are stating is the same I advocate. (Done with govt, ok cap hits you now)

This works well because elected oficials have reporting requirments which means any high income during office is subject to optics and actual regulatory disclosure.

Plus, I'm taking for granted that term limits would be put in place first.

We need to get rid of the speech circuit retirement.

Go ahead, be first. I'll wait.

Pay peanuts, get monkeys.

How much is fair compensation for a Congressperson? $250K? $500K? $1M? Why not even more? They certainly have a lot more power and responsibility than a CEO or sports coach who is paid many times that.

The problem is that there isn't a free market which any politician's salary can be determined by. Someone can't decide they don't like the salary in the US Senate and apply to the Canadian Parliament instead.

Plus, these salaries aren't that much out of line compared to other Federal government employees. The benefits are what really keeps them in the job.

I'm sure there are people who would be fantastic in politics but choose not to because of the pay.

Doesn't seem hard.

Let's make it fairer and attractive.

We can start with $1m.

If that was the starting salary for a congressman, then forget about FAANG jobs, I'm just gonna be a congressman.

Edit: And I'll still day trade, what are you gonna do to stop me?

Yes, please do. We need more competition in being congressman.

I even think president should be paid like 40m a year.

Stopping day trading is an orthogonal goal. I never see these two coupled together.

Very high salaries are a countermeasure against conflicts of interest and “lobbying.” We can trust our leaders better if we don’t have to worry quite as much about other parties tempting them

They really aren't. You are implying that highly paid people are automatically more honest, but reality often shows the opposite. There are unlimited opportunities for corruption in these roles, and whether someone decides to act on it or not isn't dependent on them making $125K vs $250K in salary.

Agreed. I’d be surprised if money moved the ethics needle at all - ethical people are ethical, unethical people are unethical. The notion that one day someone unethical wakes up with an extra $100k/year (or $1 million) and all of a sudden realizes their past transgressions were wrong and they will henceforth be an upstanding citizen seems ludicrous to me. I’d also be shocked if there was any evidence to support the notion that higher pay attracts more ethical people. Bernie Sanders is going to be Bernie Sanders and Donald Trump is going to be Donald Trump regardless of their respective net-worths or paychecks. I’m struggling to think of anyone I have ever met, or from pop culture, who became more ethical as their wages increased.

I don't see how increasing the salary of a politician would prevent them from taking money for their _campaign_ given campaigns spend millions of dollars and not $174k

This whole salary debate is pointless when there is a "cost of staying in power"

Is that not a good wage? That's at arouns 5x median/3x average American wage from the numbers I found online and puts them in the top 6% of earners in the country based on a random calculator I found[1].

I accept there's probably some variance here, but even if they're in the top 10% of Americans, is that not sufficient? What percentage do you think they should be in?

[1] https://dqydj.com/income-percentile-calculator/

Yes, I 100% agree. I've mainly been in tech throughout my career with a few times working in gov here and abroad but have above average familiarity with how the current system works in Congress. Unfortunately, there is no constituency that is ready to vote for higher congressional salaries now. However, while there salaries are one thing, I think the caps they get on # of workers, square feet of office space, and total budget they get in both the House and the Senate is far more dangerous. These offices are criminally understaffed, you've got kids with 1-2 years of work experience, most of it probably in opening letters for the same person they're working for now, managing portfolios for freshman Congresspeople that have serious potential impacts for the nation. There are some fellowships that have sprung up to assist and some federal agencies lend people out to committees but it is nowhere near enough and the repercussions are going to be serious, esp for tech which is now truly on the radar for regulation but which very few congresspeople or their staffers understand.

Agreed. A salary that would allow them a decent quality of life while having to maintain at least 2 residences (DC and their home district) is absolutely required. Money is deferred time: we want politicians to focus fully on serving the people not trying to balance their household budgets.

The cheaters are going to cheat anyways. The politicians who are inclined to do the right thing: let’s make it easier for them.

How about public housing in DC for congress critters and senators? Windowless dorm rooms so they're tempted to go outside and do stuff instead of sitting inside watching tweets or whatever.

For what is worth, if they get even less compensation and more limitations it might become even less lucrative for capable individuals which I'm honestly not sure if it won't make things even worse as it leads to both less misaligned incentives but also worse quality talent.

You can't get anywhere near a top-notch CEO for their salaries, why would you expect to get a top-notch Congressman?

I think you're mixing up your branches. Congressmen are legislators, not executives. How much does a board member cost? :)

Couple hundred thousand a year for the right board! Edit to add a link


Let's say we increased that salary by 10x. Why would they not simply continue their lucrative conflict of interest side gig on top of the lucrative salary they make? The potential gains from trading on insider information are greater if you have more money to invest!

There's more at risk to be lost

I’d be in favor of allowing them to put their money in blind trusts and withdraw them tax free after 10 years. It would encourage them to adopt measures that help the nation gain long term advantages, not short term

Or maybe you shouldn't build a society around making capital gains and interest income from doing no work as that encourages politicians to become corrupt for a quick 10 million bucks and thereby let them off off dividends or stock buybacks long after their political career ended.

All those people that pretend to understand that interest rates affect discounted future values seem to forget that this is also creating short term thinking where destroying something (potentially long lived) to get money today is profitable and encouraged.

it would also probably reduce the opportunity costs for other good candidates to be members of congress for shorter periods. Career politicians are a blight.

I strongly do not believe that higher salaries will change anything.

In every country I’ve lived in, politicians are not there for the formal salary/responsibilities. Those are tangential.

Political roles attract people who want power and control. The networking of favours is expected and emphasised - with money being the underlying foundation for it all.

This is all quite obvious social science, and I’d be curious to hear others thoughts.

I don't know if you realize this but most of the folks who get elected to Congress are already very wealthy and those that are not become wealthy very quickly. And this might come as a surprise to you but the Democrats in Gov are far more wealthier than the Republicans...Go figure the party that says they represent the small guy...lol...

Based on data from disclosures, it seems that the democrats invest way smarter than republicans. I wonder who has more income when entering congress, vs who ends up making more per term. Are democrats actually wealthier, or do they just better use their inside knowledge.

You can be personally wealthy and want to support the “small guy”. It is not a contradiction.

or just make the consequences for abusing power so drastic that power hungry psychopaths don't run for public office which would be far more effective. The main reason congress is corrupt is because they make the rules and know they will only ever get a slap on the wrist.

Make any form of corruption by congress automatic death penalty and congress would clean itself up pretty quick because the type of scum who go into politics to make money would look for easier targets where their life isn't at risk

Of course the problem with this is who enforces the law and how do you stop them from being corrupt themselves. The obvious answer to the root problem is to have the smallest government possible to limit centralization of power and ability for mass corruption

I think there should be more of them so that we might actually know the guy. It's too big a job for its original intent I somewhat think.

Totally agreed for the House. There is an outstanding amendment from 1789 that would apportion one representative for every 50,000 voters.


The house would be much bigger if the size wasn't capped in 1929. Representation would also be more equally distributed.

More salary is fine, but stock trading is an entirely different question.

Or our doctors! Imagine if most kids would answer "congressperson" instead of doctor or lawyer. More competition might help that sector.

I mean, lots of kids want to become president which at a certain age is basically code for "I want to be a political leader and don't know how the system works in its entirety". Does that not qualify?

Not really. Presidential aspirants are more about personal glory than serving people. It’s the people who like to serve the public that should ideally be involved in politics.

My point was that the desires of children are largely inconsequential to their future careers, particularly when being asked questions like "what do you want to be when you grow up".

> I'm fairly certain we should be paying our elected officials at least as much as our football coaches.

Or! Pay our football coaches significantly less/tax them more and redistribute that wealth towards a safety net for all Americans.

But sure, give members of congress a cool million while the poor go hungry.

To be clear, I agree with the sentiment. Elected officials should probably get a bit more money. But, I think you vastly underestimate the greed of the ultra-wealthy in the US. Ultimately government jobs need to be motivated by a desire to change the system for the better. If you just give them all millions of dollars you're inducting them into the class of the wealthy on day one.

All the discussion about how much Senators and Representatives should be paid and whether it leads to bribery misses the most important moral point, which is:

They are in a position to influence stocks, and hence must be barred from owning them, other than in a blind trust.

It's the same moral principle as "Judges must recuse themselves from cases in which they have a financial interest."

We want them to vote on regulating Big Tech based on their understanding of the issues and their constituents' desires, not on their holdings of Big Tech stocks. Yes, I know that's naïve and there are campaign contributions to think of, but that's a separate topic of law.

Discussing whether they get "enough" to live on also misses the fact that they're not doing it for living expenses -- they're doing it to get rich.

I have trouble with the escalation of demands being made on social media.

Initially the titles talked about banning "insider trading", despite them not legally being insiders (which is a very specific legal term which refers to company employees/agents which specific non-public corporate information).

The the titles talk about banning "day-trading", which is trading in-out of stocks multiple times per day. They are almost certainly NOT doing that.

...now you're saying they cannot even have any stock ownership - which would imply they cannot have a 401k or 529 for their kids (because those invest in funds) - or even a vanilla money-market savings account at any bank.

Taking this logic further, they shouldn't be allowed to own any financial assets - bonds, real estate, etc...

These arguments have lost touch with reality.

First of all, you're right about the title. The article is not about day trading, which confused me at first too.

However, "insider" is often construed broadly as "possessing material, non-public information." For example, if you work at Google and you realize the next earnings are bad and you call your brother-in-law, who sells short, he can be prosecuted for violating insider trading laws. I think. Not just you.

Now as to "you're saying they cannot even have any stock ownership" -- I didn't say that, I said "blind trust." This is a legal vehicle that's been used for public officials for generations. It means they can't influence it and they don't know how it's doing.

Your example is not correct. Insiders in companies are specifically designated people. Top executives and anyone with access to material non-public financial information.

Just being an employee does not make you an "insider". I regularly traded in the company I worked for. I did not have access to any financial information, so it was all based on my hunches of how sales were doing.

There's nothing illegal about that.

Moreover, you are not in violation of insider trading laws just for knowing insider information. You have to have received it from someone you knew was violating their insider status, or compensated them for such. For example, if you overhear someone in a bar talking about their sales numbers, and you trade on that - you are not guilty of insider trading.

I didn't say being an employee made you an insider.

However, many (most?) companies nowadays impose blanket trading restrictions for the month before earnings reports. I know Google does, and probably the other FAANGs as well.

In my example, the brother-in-law would get caught and questioned, since the SEC actively watches for trades just before major moves in a stock. He could expect to be asked "why did you short Google?" I would not want to be in his shoes. And the employee could also expect to get asked why he called the BIL. Would the SEC go that far? They certainly could; whether they always do or not, it's "do you feel lucky?"

Do you think we can't dig up examples where this has happened?

In any case, the "blind trust" is the answer to conflicts of interest. Public officials have the ability to affect the fortunes of any private company by the performance of their duties, and that's why they're quite often required to use one.

As I've said before, publish the trades of politicians and Fed officials online every evening. If they make hundreds of millions trading on information the public is unaware of, disseminate that information quickly. Politicians say things they know are untrue, but they will trade in what they perceive to be their interests.

"Some of the most egregious stock trading in Congress occurred when several Senators dumped large volumes of stock in Winter 2020, right after Congress was briefed on the magnitude of the Covid threat. Sen. Kelly Loeffler sold millions in stock. Her fellow Georgia Sen. David Purdue made a windfall by dumping and buying back stock. Sen. Richard Burr offloaded more than $1.6 million in stock ahead of the market crash (and then made a suspicious call to his brother-in-law, who promptly called a broker)."

I've got a slight improvement to your idea. Instead of publishing the trades after, or as they make them, instead publish them before they make them.

Require any congress-person who wishes to trade a stock to write a plan saying "I will buy/sell roughly this many dollars worth of these shares on this date", and require the plan to be published a week before the trade is executed.

We already require CEOs and company officers at large companies to do similar plans (though they do not have to publish them publicly ahead of time), and requiring our government officials to act as sorta officers of the entire economy seems kinda fair. They have material information on many different things.

Making them decide on trades weeks or months in advance seems like it should prevent day trading, while still letting them invest in reasonable portfolios if they want.

When I worked in a financial trading firm, I had to submit trades that I would make 3 days before hand and then get them approved to make sure I had no relationship to that stock. The same seems fine with me for any government official.

Make a trade request, gets published publicly, a legal body reviews and allows or denies.

This makes perfect sense to me and there are oversight bodies within congress, the folks on the house modernization committee could probably whip up a tool too. Just has to be the will to do so & I'm not sure there's enough outrage on the issue.

> a legal body reviews and allows or denies.

Who will be the members of the legal body?

Congr- Oh.... I see what you did there.

The difference between our views is that I want government insiders to trade on their information, as long as their trades are soon publicized, so that the information is quickly incorporated into market prices. Slowing down their trading by making them wait a week interferes with that.

This is the best idea yet in my opinion.

Why online in the evening? Do it in real time with an official federal FIX stream.

Imo real time is not enough, but it is a solid bare minimum requirement. If private executives have to schedule and declare their company equity trades months and months ahead of time, why do we let the government officials off the hook with just real time?

I am not proposing the same “months and months ahead” rules for politicians, because for private executives that restriction applies only to the equity of their own companies (while for congress it would be for all companies). But what about a day ahead? I think that’s reasonable to make government officials to declare their trade a day ahead. After all, unless it is some specifically-timed trade based on insider info, why would it matter? It is just a single day.

But i would also be ok with “declared a day ahead to SEC, with the trade info being automatically released to the public the second it happens” (basically, same as real-time, but with an extra safeguard). Mostly proposing this one, because I am concerned that knowing their trades ahead of time publicly might introduce unwanted side effects.

> because I am concerned that knowing their trades ahead of time publicly might introduce unwanted side effects.

Unwanted side effects like them not buying small volatile stocks that are perfect for insider trading, and instead buying large index funds that are difficult to manipulate?

Frankly, anyone who's buying small named stocks that the market can move is either 1) a gambling addict, 2) a professional daytrader, 3) an idiot, 4) breaking the law, or 5) all of the above.

I would personally prefer that we do not hire day-traders to represent us in government (or if we do, that they stop daytrading for the duration), so I'm fine if this just has the side-effect of no congress-people daytrading.

Maybe I am misreading, but I am genuinely confused how small cap stocks are related to the conversation at all. My concern wasn’t regarding small cap ticker traders, but something more like attempting to manipulate the market movements by doing certain bogus trades, as well as tons of others that someone else could have come up with.

Basically, I am sensing there might be unwanted side effects from this, but I am not sure. I don’t think it makes sense to worry about much, given that a “report a day ahead” system would be good enough and wouldn’t have as much potential for unwanted side-effects.

Keep in mind, it wont only be the retail traders looking at the live feed of Pelosi’s trades, it will be all big institutional investors as well.

Ah, apologies for not explaining more.

What I meant was that if a congressperson says "I will buy $100 worth of $SMALLCO in two weeks", that would artificially increase the price of that stock, and the congressperson would get less money / traders would profit slightly by selling shares they got cheaply.

This effect is what I thought you were concerned about. Such an effect can only happen if these known trades are a significant fraction of the market cap, or the activity, on that stock.

The reason I'm talking about small cap stocks is that those are the only ones I think such side-effects would occur on, and such manipulation wouldn't really be feasible for things like large index funds or AAPL or such.

Hopefully it makes sense what I'm trying to say now? It would indeed have severe negative side effects for a subset of possible trades, but I don't think those trades are reasonable ones to make.

I understand what you are saying now better, thanks for clarifying. I still disagree that it would only affect small cap tickers. If it was only small cap tickers like you are saying, I would have been all in favor of your proposal with zero hesitation or second thoughts.

While Apple might be an outlier example, I think that a congress person heavily investing into even significant cap tickers (like Palantir or Ford or Pfizer or etc.) could move the market and turn into a self-fulfilling prophecy.

I am not worried about the investment dollar amount itself being the catalyst (because you are correct, senators don't have the raw amount of money needed to move the tickers by its own virtue), but everything else influenced by it. If everyone saw that some senator is extremely bullish on something like Ford, institutional investors will likely jump onto it as well (and large institutional investors definitely can affect the market with such moves, as they quite often do).

Not even mentioning retail, but I agree that it isn't that important and can be disregarded for the purpose of this conversation. You are right that the retail dollar amounts aren't really high enough to move the ticker on their own for non-small-cap tickers (but it can make the pump from large institutional investors more significant).

I'd be ok with them having to declare it months ahead of time, or better yet, banning individual stock ownership for members of congress who have the most privileged information.

> As I've said before, publish the trades of politicians and Fed officials online every evening

Just like banning trading, this will be circumvented by family/business proxies doing the trades. Including potential family proxies, in the public accounting, would probably be the most effective move to motivate ethical behavior. At least put some risk in the form of the relationship to the business partners, given the vast amounts of money flowing.

Sounds great. Could we also start some sort of Index fund using those trades? Congress seems to have some fantastic returns I would like to tap into!

They're required to disclose the trades, but usually have like 2 months to do it and the fines for not disclosing or improperly disclosing are minimal to none. It's a joke.

They should be held accountable like most people that have a conflict of interest. I work for a publicly traded company, and even though I don't have anything to do with the financial side of things, I'm forbidden from trading for most of the year to avoid any potential conflict of interest.

Not an index fund, but you can programmatically get access to their disclosed trades and create your own trading bot from there. I think this disclosures are a month or so after the fact.


Nice info. A days lag would be better, or instant! I think a month would give them plenty of time to dodge the crash. Like happened in 2020.

I remember a thread on this a few months back, and the problem is that most of these trades happen at the small windows in time where members of congress have information the public doesn't. While trades by members of congress have to be made public, there is a delay. If you buy/sell after the delay (up to 45 days), the performance isn't really going to correlate with what they're getting.

Side effect would be that this would help them make even more money, due to lots of money following their trades after they have entered the position, and it would create pump and dump incentives.

>As I've said before, publish the trades of politicians and Fed officials online every evening. If they make hundreds of millions trading on information the public is unaware of, disseminate that information quickly.

Then Senator Jackass dumps stock on Monday to crash it and picks it back up for a song on Tuesday.

Wouldn't that be a wash trade?

What benefit would that serve? We already know this is happening. So we would know it... more?

CEO's and officers of corporations have to disclose their trades of their company stock. It is only fair that the public officials making the laws that govern the operations of said corporations should have to disclose all their stock activities as well, since almost any law they pass could potentially impact almost any company.

This is already the law. Since the "Stop Trading on Congressional Knowledge Act of 2012", they already have to disclose any stock trades made by themselves, a spouse or a dependent.

Because this hasn't fixed the issue, and most don't seem to have any shame, these recent laws (originally coming from Ds but Rs have their own version) prevent them from trading individual stocks while in office.

I think the problem with this act is AFAIK it states they have to report the trades 45 days AFTER they make them. Not before they make them. So they all just wait until 45 days later when it’s not relevant anymore. New news cycle, people forget

AFAICT they wait even longer than that, and suffer no consequences. For example, Rand Paul waited 16 months to disclose his wife's trades in Gilead Sciences.


RP is a particularly grotesque piece of work (not only in this regard), but he's far from alone. Staffers are subject to the same rules, and at least 182 of them have done the same thing.


CEOs and officers don't just have to disclose their trades, they have to trade on schedules.

Exactly. The same rules should apply, except for CEO's it's just their company they have to disclose ahead of time because their decisions affect that company, for congress it should be any company they trade because their decisions are more far reaching and can affect almost any company.

How is it acceptable for them to engage in these activities while on the job? It should be illegal based upon their job duties. During office hours, and while at the office, like everyone else, they should be required to carry out their job duties and not engage in personal or outside activities. Trading stocks and the like has nothing to do with their job and should not be done while at your job.

If a congress person is caught doing anything else besides their job, they should be fired immediately for cause. We need to put the public service back in public service.

Are you 100% focused all the time when you're at work? I think it's a bit unrealistic to expect that kind of focus from anyone at any job. If they're getting their work done, I don't see the harm in trading stocks ASSUMING they are playing by the rules, i.e., not insider trading.

I think there’s a difference between reading the news or social media occasionally at work and doing something like trading stocks. It falls into the realm of work. I know some people trade stocks for leisure but the vast majority do it to make money.

Is it right to work another job for profit at your employer or while your employer is expecting you to be doing work on behalf of them? According to my moral compass, that’s a no. I would be pretty upset if I found one of my employees trading stocks while they were supposed to be working. Especially if my approval of them was low, which is the current situation with many government officials right now. If there was agreement on both sides before taking a job, that would be different but I find that hard to believe before taking a job someone would admit to that, and that’s a sign they know it’s wrong.

They have a lot of nerve thinking this is acceptable behavior when the country is in the middle of a crisis and has a lot of problems to solve.

The problem isn't that they're doing something other than their job, it's that they have insider information, and they're using that insider information to buy and sell stocks.

Their insider trading a very small problem compared to the problem of the perverted incentive to steer legislation in a direction that helps their portfolio.

based on what metric? Do we know have evidence of them voting for their own portfolio vs trading their info? Based on data i've seen, it seems more likely that they're insider trading. (Except for republicans trying to support fossil fuel legislation...)

It is far more likely that they're insider trading, but the point is that the magnitude of the negative consequence is vastly different. If they insider trade and make $5 million, that's money stolen from other market participants. Bad, for sure, but the scope of the damage is limited to that stolen $5 million. If it corrupts policymaking by creating a conflict of interest, the scope of damage is uncapped.

I completely agree! The legislative capture of bad decisions is far more dangerous than them "stealing" from wallstreet.

I agree with what you said, except the part about stealing from "wall street". Most of that money is stolen from regular people's investments and pension funds.

Not sure i even agree with that.

Most markets are not 0-sum, and taking a "long" position (congresswomen buying low, and selling high) won't cause anyone harm unless they took a short position on the asset - which hopefully most people's regular investments don't do.

I absolutely think this should be banned but they (and their staffers) don't have real workplaces. Sure, there's the office but a ton of their work is meetings, talking to constituents, travel between their district and DC, etc. and many of them put in 80+ hour workweeks. Trying to put them in the bucket of an average 9-5 person with a set workspace doesn't work.

Spoken like a truly horrible manager.

They aren't necessarily trading on the clock. Just making trades based on information nobody else has that they only have access to because of their job.

It has to also include the typical provisions for insider trading like "telling others material information related to stocks / companies etc". I tend to like the idea people are proposing of requiring the information to be disclosed in real-time when the trade is made (also not like "at the closing bell" BS that I'm sure people would push for..). Like it would be awesome to see people making trades 10 mins after a briefing and going, huh.. ok cool, so looks like Lockheed won the contract... :-)

Insider trading for EVERYONE! The market is already part scam part gambling. Let's give private business a shot by making publicly traded ones little more than a pyramid scheme.

Does anyone actually believe this is going to accomplish anything meaningful? I'm sure there is thousands of more loopholes to get around it. We should be focused on accountability to the American people, not just the rich.

Awkward title. It implies congress is considering a ban on retail day trading.

I wish every time someone complained about a title, they included the title at the time. HN moderators are very quick to correct issues, and it leaves the comment and the rest wondering "what is wrong with it?"

It seems obvious after I caught my mistake, but I too originally misread it in this away. Not sure why you're being downvoted.

Interesting interpretation....never in a thousand years would have read it this way.

I take it you don't trade/follow financial markets?

how? It's one senator saying this....

The headline can be interpreted as "Members of Congress should not themselves be day trading" or as "Congress should enact legislation to prevent everyone from day trading". The article is clearly the first one, but the headline could be read either way.

I think the second reading is more natural. The title should be "congressmen need to stop day trading".

I see. moral obligation vs legal imperative.

off topic, but I know congressmen know the only way is legislation

We will see a black hole evaporate via Hawking radiation before a bill such as this becomes law. The United States Senate is the body representing the capitalists/landed gentry/aristocracy/etc., and from my amateur reading of US history it always has been. The House is only slightly better.

There may be politically powerful voices which speak out on issues such as these, but only briefly. Tomorrow will be a new crisis, or celebrity death, or something which takes attention away. And because the politicians voicing support for change are in the minority, and support for their efforts non-existent, then there is no momentum to push it forward beyond the crisis of the week.

This has been true for as long as I can remember. I have never seen evidence, current or historical, that gives evidence otherwise. Instead, voters are blamed, blamed for a system they have little to no power to affect in any significant way.

And the best HN can come up with is throwing more money at the problem making anyone in public office automatically a part of the gentry.

Seems like the only way to enact "real" change is to convince the propertied class that such changes are within their interests (and have them pull the strings in a mutually-beneficial way).

I cannot think of anything the lower classes can offer that would be of any substance -- only things they can take away by force to impel the other to meet "eye to eye."

> We will see a black hole evaporate via Hawking radiation before a bill such as this becomes law.

This is the content I'm here for. Well done LOL

Why not leverage the power of technology?

Just pay these people 50 mil a year and tell them to go away.

Why 50 million?

Only way we'll ever get rid of Pelosi.

I can't recall who said it, but the gist of the quote was: "If you want to eliminate earnings inequality in the United States, give every citizen real-time access to Nancy Pelosi's trades."

According to the now-Cancelled Twitter account (would that have happened if she was a Republican?) dedicated to her financial shenanigans, her portfolio has outperformed Bitcoin. Something is deeply, deeply wrong here.

Is there no other source for information on her financial activities?

Nothing as detailed as the Twitter account, unfortunately — but I'm still looking!

Decent article:


Interesting (though they have 30 days to report their activities):



If you've ever wondered why anyone would run for Congress given the pay, this is your answer. What's amazing is how many of them will shamelessly promote the idea of corruption in other countries, and then day trade and grasp their hypeocricy.

That's absolutely correct. It's far from the only way they profit from their offices, but it's certainly one way. It's shameful that you were downvoted for making the point.

I stopped worrying about down votes and HN dysfunction a while ago.

That aside, such information is a form of currency, and done right...untraceable. A term or two in office, is temporary. The involvement in this currency is forever.

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