If You Want to Be a Stonk Man, Don't Run for Congress
After the cartoon corruption of the Trump regime, your more garden-variety chicanery from those occupying positions of the public trust has come to seem almost quaint. But problems remain, as we were reminded again this week thanks to a report from The Daily Beast on the activities of one Dan Crenshaw, a Texas congressman who shot to national prominence after he was subject to a dumb bad joke from—and a blundering make-up segment with—a Saturday Night Live cast member. It turns out that, when he wasn't stoking the culture war or lamenting all the divisiveness in our politics, Ol' Dan got himself into the equities trade. Specifically, after trading no stocks for his first 13 months in office, Crenshaw got into the market in March 2020, just as Congress was set to pass the CARES Act and inject a bunch of stimulus into the economy. To compound things, he failed to report these transactions, in possible violation of the STOCK Act.
Now, Crenshaw's trading volume was, by recent congressional standards, fairly low. The statute requires members to report a range for the dollar value of their trading activity, and the Beast suggested he could have been dealing in up to $120,000 in securities. Crenshaw's spokesman says it was as low as $30,000, and added that "in no way were his purchases unethical or related to official business." Some of his colleagues have been far more active: Richard Burr of North Carolina was under investigation for months after he sold off his shares in travel companies at a highly advantageous time. That investigation was dropped in January. He was joined by then-Senator Kelly Loeffler, a former financial-services executive who played the Trumpian populist on TV, and who also faced a (far shorter) probe into some similarly fortuitous trades. But they all paled in comparison to her then-colleague from Georgia, Senator David Perdue, who seemed to view his office primarily as a vehicle for stock tips. It wasn't just Republicans, either, though the investigation into Senator Dianne Feinstein's husband's well-timed pandemic trades was abandoned fairly quickly.
The solution is glaringly obvious, and it does not lie in the STOCK Act, which seeks to "prohibit Members of Congress and employees of Congress from using nonpublic information derived from their official positions for personal benefit." Instead, members of Congress should be banned from trading stocks while in office. Sorry folks! If you want to be a Stonk Man, don't run for a seat in the federal legislature, where you will almost certainly be in regular exposure to nonpublic information about the economic, political, and national-security future of this country, and where you have power and influence to shape that future as you see fit. You signed up for public service, not simply holding public office while trading Stonks. There are many banks and hedge funds around for you to join. Plenty of Capitol Hill alumni have done so! Which, like the revolving door of the Washington influence economy, is something else Congress might address.
Some members are already on this page, including Alexandria Ocasio-Cortez, who has adopted a personal policy of not trading individual equities while in office. The Swamp Drainers will probably come up with some reason that this is Bad, but it is not. It is Good. Others should emulate her example, and better yet, the policy should be made law. If that will discourage some people from seeking office, it's probably a good thing those people are not in office. This dovetails a bit with the ancient struggle over whether and how much to pay public officials. The in-turns revered and reviled Founders of this country struggled with this, and by the Senate website's account, some initially thought senators should not be paid because they'd likely hail from the upper classes anyway. They didn't need the money! While serving in Congress was often a part-time job at the time, they still settled on the other path, avoiding a scenario where public service would be the exclusive remit of those who can afford to take a job without a salary.
The $174,000 most members of Congress now make is a lot, but it's less so when you consider that goes towards two sets of lodging—one in D.C., one back home. The result is stories of members sleeping on their office couches, or, in Chuck Schumer's case, shacking up in gross collegiate-style conditions with other federal lawmakers. There is a solid argument that they're still not paid enough to account for the cost of living, and most members of Congress are rich, though that is probably partly due to the cost of campaigns.
And more than that, a move to make serving in Congress a more lucrative venture on its own might discourage people from seeking outside sources of income, like Stonks, which necessarily present conflicts of interest and call into question whether they are making policy solely—or even primarily—in the public interest. It might seem counterintuitive, but raising congressional pay might make the job less swampy. Better they get paid well to work on behalf of their constituents, rather than on their own behalves. Or maybe it's all a pipe dream. In the meantime, though, let's leave the individual Stonks to those who do not wield such power over, and have such advance and detailed knowledge of, future American policy. Get yourself an index fund.
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