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Why are politicians so DAMN RICH?! | Johnny Harris

Generally, investors will lose all of their money, unless a small portion of their investment is redeemed through the sale of any company assets.

The Shadowy World of Congressional Insider Trading: How Lawmakers Profit from Non-Public Information

In the corridors of power, where laws are made and fortunes can be won or lost with the stroke of a pen, there exists a shadowy practice that strikes at the heart of trust in democracy: congressional insider trading. This practice, where lawmakers use non-public information to buy or sell stocks, has long been a murky issue, with lawmakers often escaping consequences despite clear evidence of wrongdoing. Let’s delve into this complex and troubling phenomenon.

The History of Congressional Insider Trading

Historically, lawmakers were not restricted by insider trading laws, allowing them to trade stocks based on information not available to the public. A study showed that senators in the 1990s consistently outperformed the stock market, raising suspicions of insider trading. This trend continued until the passage of the STOCK Act in 2012.

The STOCK Act: A Weak Deterrent

The Stop Trading on Congressional Knowledge (STOCK) Act was passed in 2012 to ban Congress from trading stocks based on insider information and require disclosure of trading activity. However, the act has been criticized as weak and ineffective, with no significant penalties for violations. Despite this, some lawmakers have been involved in suspicious trades.

Notable Cases of Alleged Insider Trading

Several high-profile cases have brought the issue of congressional insider trading into the spotlight. Republican Congressman Spencer Bachus made a trade in 2008 betting on a market drop after attending a private meeting with top officials, raising questions of insider knowledge. Senator Richard Burr sold stocks after a briefing on the severity of the Coronavirus pandemic, and Congressman Ro Khanna’s family made trades involving companies Khanna likely had non-public information about.

The Optics of Insider Trading

While technically not illegal, the optics of congressional insider trading are damaging. Nancy Pelosi’s net worth grew significantly during financial crises and the pandemic, raising questions about potential conflicts of interest. Republican Congresswoman Marjorie Taylor Greene made investments before tweeting about war and Russia’s invasion of Ukraine, potentially profiting from insider knowledge.

Calls for Reform

There are calls for banning members of Congress from selling individual stocks and instead putting them in blind trusts or trading in mutual funds to avoid conflicts of interest. However, efforts to pass such legislation have been met with resistance, highlighting the challenges of regulating Congress by Congress itself.


The issue of congressional insider trading strikes at the core of trust in democracy. While efforts have been made to address this issue, including the passage of the STOCK Act, loopholes and weak enforcement have allowed the practice to continue. As long as lawmakers are able to profit from non-public information, the trust of the American people in their elected officials will remain fragile.

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