Henrico Citizen: Spanberger’s bill to prevent stock-trading by members of Congress and their families builds momentum

HENRICO CITIZEN, WESTEN DORAN

U.S. Rep. Abigail Spanberger’s TRUST in Congress Act, which prevents members of Congress and their family from trading stock, is building momentum in Congress with strong bipartisan support and an evolving co-sponsor list.

H.R. 336, also known as TRUST (Transparent Representation Upholding Service and Trust) in Congress Act, requires all members of Congress and their spouses and dependent children to place certain assets into blind trusts, preventing them from insider trading. Spanberger, a Democrat who represents Virginia’s Seventh District, reintroduced the legislation to the 2021 Congress after previously introducing it a year earlier. The bill was referred to the House Committee on House Administration, where it awaits the next steps.

Her original introduction of the measure in 2020 came after she had a discussion with Rep. Chip Roy (R-Texas), about the level of disgust she had about members of Congress who were buying stock related to pandemic resources at the beginning of the COVID-19 pandemic.

“We were more than expressing a level of disgust over the fact that all of this was happening,” she said. “But that the American people were like, ‘Of course they’re doing that. During a pandemic, we’re worried about putting food on our table, not getting sick, not dying or worried about schools closing down.’”

A POLITICO review from March 2020 showed that some lawmakers and their families and aides adjusted investments portfolios in January and February 2020 when members of government were being debriefed about COVID before the public was alerted to how the virus might impact their lives. Some members sold their stocks in airlines and cruises (including Rep. Susan Davis, D-California), while an aide to Sen. Jeanne Shaheen (D-New Hampshire), bought stock in Clorox, Inc., before the market crash in 2020.

Spanberger wanted to instill the trust of Congress back in the American people, hence the name of her legislation. Beyond preventing members of Congress and their families from being able to trade stocks, she wanted to remove the possibility of the perception of it, as well.

“Even the perception of impropriety erodes the trust that the people have in whatever entity or organization that you’re working in,” she said. “To give anyone the idea that a member of Congress is more focused on their financial holdings than they are in that service degrades the trust that people have in Congress.”

In a recent survey sent out by Spanberger’s office, 93% of more than the 3,200 responses were in support of the legislation, many citing in their responses that it would be a good thing to hold members of Congress accountable.

Along with citizen support for the bill, there are 53 co-sponsors from Congress, both Democrats and Republicans, who have signed onto the bill.

Similar bills have also been introduced by both parties, something that Spanberger said helps the conversation move.

“The one thing that is an absolute priority for me is that spouses have to be included,” she said, referencing the unique part of her bill, which includes spouse and dependent children to put their assets in a blind trust.

While, citizens and other members of Congress support the legislation, outside political organizations also have encouraged the bill and the transparency it includes.

“The TRUST in Congress Act ensures that members of Congress cannot leverage their position to build or influence their own financial portfolios,” said Jessica Jones Capparell, director of government affairs for the League of Women Voters. “The measure in this law will increase government accountability and ensure transparency so that the American people know that their representatives work for their interests.”

As this bill has gained more attention, there has also been some hesitation from members of Congress. Some of Spanberger’s colleagues were worried that signing onto the bill would make it seem like all members of Congress were corrupt in some way, but she said it is the complete opposite.

“This is our chance to demonstrate effectively that we are not corrupt and that we are focused on our constituents,” she said.

House Speaker Nancy Pelosi (D-California) was critical of the legislation early on but recently changed her position on it somewhat.

In December 2021, Pelosi publicly opposed the idea of banning members of Congress from owning stock in companies during a news conference, citing that the United States is a “free market economy and they [members of Congress] should be able to participate in that.”

Pelosi changed her position on the matter during her press conference the week of Jan. 20, saying she “doesn’t buy into it, but if members want to do that, I’m OK with that.” Even with her signal of support, there are still concerns raised that other members of Congress also have expressed.

In contrast to those members of Congress who don’t believe the bill is necessary – and who believe they should be allowed to trade however they’d like – Spanberger believes it’s necessary in order to ensure that there are no issues of insider trading.

“If you want to be a day-trader, don’t be in Congress,” she said.

Aaron Scherb, director of legislative affairs for Common Cause, raised concerns that the bill could deter people from wanting to run for office.

“We don’t want any legislation to this effect having unintended consequences,” he said. “Disincentivizing candidates of modest means to be able to run for office. . . we don’t want to make it harder for people of modest means to run for elected office.”

Scherb also discussed the expansion of the legislation to members of the government beyond Congress.

“Any legislation should not apply just to Congress, but also the judicial branch,” he said.”

An extensive report published by the Wall Street Journal in 2021 found that more than 130 judges ruled in cases in which they had traded or had a financial stake. Scherb cited this article as a reason to have this legislation be enforced in a government-wide approach.

Lastly, she referenced the misconception that this bill could somehow impact 401ks plan, especially when it comes to spouses being included in the bill. Spanberger said that the aim of the bill was to prevent members of Congress from profiting off information to gain money.

“It’s not about a particular ideology,” she said. “It’s about what members of Congress should be doing relevant to their constituents.

“This is a bill that really resonates with people and seems very straightforward to many Americans.”