When Speaker Nancy Pelosi stepped into her weekly press conference one day in February, she found a room full of reporters dying to ask her the same question.
That morning, the Beltway tipsheet Punchbowl News had reported that Pelosi was expected to endorse some sort of ban on lawmakers’ ability to trade stocks while in office.
For months, a broad swath of lawmakers—Democrats and Republicans—had been pushing various proposals to reform congressional stock trading rules, in response to growing public outrage over a string of stories showing potential conflicts of interest in lawmakers’ trades.
That push had picked up serious momentum in the House and Senate. Pelosi, along with a number of other top lawmakers, didn’t exactly embrace it. But given the overwhelming public support for a ban on lawmaker stock trading, she likely knew she couldn’t entirely dismiss it, either.
So, when Pelosi left her press conference, she somewhat miraculously got the headlines she wanted: a number of news outlets reported that the speaker had “shifted her stance” on the issue, or that legislation was “moving.”
In reality, the closest thing to an endorsement that Pelosi offered was this tepid statement: “If that’s what members want to do, then that’s what we will do.”
The task, the Speaker said, was to “build consensus.”
Six months later, not much has changed.
There are several bills in both the House and Senate to restrict stock trading that have earned broad support, but none have received a vote—or as much as a markup on the committee level—as the issue falls further and further down Congress’ increasingly packed to-do list.
After countless private conversations, reams of legislative text, and a public hearing on the issue, lawmakers in the House and Senate say they are not lacking in consensus on the most important fundamentals of the issue. Many believe there is enough support for at least a basic prohibition on members, and their spouses, from trading and owning individual stocks while in office.
Lawmakers involved in crafting a compromise proposal sounded optimistic this week that a deal was close.
“We have a bicameral coalition that is working hard to put together legislation that could pass the House and the Senate,” said Rep. Raja Krishnamoorthi (D-IL), author of one of the stock trading ban proposals.
“We are not yet in a position to share details, but know that we are very actively working on this, and we will continue to fight until these needed reforms are signed into law,” Krishnamoorthi told The Daily Beast.
But other lawmakers believe there is a simple explanation for why momentum for the stock trading push got sapped, and it’s the same reason they believe that even a consensus bill might still face stiff headwinds.
“The people who control the calendar don’t want to bring it to the floor,” said Rep. Abigail Spanberger (D-VA), author of a bipartisan House proposal to force lawmakers to put their assets in a blind trust. “The people who control committees of jurisdiction don’t want to bring it to the floor.”
In response to questions from The Daily Beast, Pelosi spokesperson Drew Hammill said “the Speaker is committed to acting on a proposal in this Congress.” He noted that the House Administration Committee, chaired by Rep. Zoe Lofgren (D-CA), has been tasked with reviewing the three leading proposals. A spokesperson for Lofgren did not provide any comment.
With the November elections looming—along with the possibility that Democrats lose control of Congress in January 2023—advocates say time is running out for the party to seize an opportunity to enact a major ethical reform that many believe is long overdue.
“If a consensus bill isn’t introduced before the August recess, the prospects for passing something into law before the end of the year are slim at best,” said Dylan Hedtler-Gaudette, government affairs manager at the Project on Government Oversight, which has been closely involved in shaping legislation.
That urgency was clear in Sen. Jon Ossoff’s voice on Wednesday. The freshman Georgia Democrat wrote and introduced a stock trading ban after promising to do just that in his 2020 campaign.
“We can either keep trying to build consensus, or we can put a bill on the floor and vote,” Ossoff said. “I’m for putting a bill on the floor and voting.”
Unlike Pelosi, Senate Majority Leader Chuck Schumer (D-NY) has endorsed the idea of a stock trading ban and has said he wants to get it done by the end of the year. But a similar dynamic is at play in the Senate, where floor time is even more precious, and lawmakers would need to finalize a deal soon to avoid a legislative death by the Senate calendar.
Beyond that, in the evenly split Senate, Schumer can do very little without buy-in from his caucus, and objections from even one senator can stall an otherwise broadly-supported idea.
But Ossoff sounded frustrated with the way those dynamics had affected this issue. “Consensus is a worthy goal,” he said. “The desire for universal consensus should not paralyze action.”
Many Democrats were baffled and angry watching as one of the most obvious wins at their disposal got bogged down.
“It’s really disappointing, because we should have done this a decade ago,” said Rep. Jared Huffman (D-CA). “It's inexcusable. It's unjustifiable. It's embarrassing to many of us.”
It’s true there are an array of competing proposals aimed at reforming congressional stock trading. They are not the same, and small differences in language could influence passage or failure.
During an April hearing in the House Administration Committee, witnesses and some members expressed some skepticism about Spanberger and GOP Rep. Chip Roy’s bill to require members to put their assets in qualified blind trusts.
“Every member of Congress has a slightly different point of view on how it should be done,” said Sen. Elizabeth Warren (D-MA). “There are some Republicans who want us to make no change at all… all of the Democrats have agreed that we need to make change, but there are some differences about the details of the particular restrictions.”
In February, Warren rolled out a bill with Sen. Steve Daines (R-MT), which has earned the backing of conservatives like Sen. Marsha Blackburn (R-TN). The legislation simply prohibits members and their spouses from owning or trading stocks. “I’m cautiously optimistic that we can get this done,” Warren said.
The fundamental idea of prohibiting lawmakers from playing the stock market is the rare proposal that is considered both good policy and a political slam dunk. Public polling routinely shows that supermajorities of American voters, of all political persuasions, agree that lawmakers should not be allowed to trade stocks while in office.
In a sign of the political upside, several of the most supportive lawmakers are the most vulnerable Democrats up for reelection this fall. Spanberger is one of them, as is Sen. Mark Kelly (D-AZ), who has introduced a bill in the Senate that features heavily in his campaign ads.
But many lawmakers also recognize how the public’s opinion of Congress—never sterling to begin with—has eroded even further thanks to the way Congress tends to conduct its investment activity.
Lawmakers are currently prohibited under the STOCK Act, which passed in 2012, from investing based on information gleaned in their official duties. The news outlet Insider identified 66 members of Congress who have recently violated that law.
But the STOCK Act has proven hard to enforce, and beyond that, it doesn’t address what many ethics experts believe is the more pressing issue. Lawmakers’ investments frequently create the appearance of a conflict of interest, if not an actual conflict, which on its own can seriously undermine the public’s faith in government.
Many lawmakers have been slow to see how their investment activity can invite legitimate questions from constituents about whose interests they are really serving in office.
Complicating matters is that Pelosi’s family has presented some of those very same questions: The Speaker’s husband, Paul, is a venture capitalist and a prolific trader of individual stocks who routinely beats the market.
On Monday, several news outlets reported that Paul Pelosi acquired as much as $5 million worth of stock in the computer hardware company Nvidia—just as Congress moved closer to passing a bill appropriating billions to the semiconductor industry.
The Speaker’s office distanced her from those trades, stating that Paul Pelosi’s investments are solely his and are reported to congressional authorities as “spouse” assets, not “joint” assets. “The Speaker has no prior knowledge or subsequent involvement in any transactions,” said Hammill, Pelosi’s spokesperson.
While members are reluctant to call out any individual colleague or colleagues’ families for their investment activity—much less Pelosi, the powerful and popular leader of the caucus—many believe the legislative branch could start to regain trust with the public by putting an end to the unsavory headlines.
Spanberger told The Daily Beast that her office has seen an uptick this week in constituent calls and messages expressing concern about lawmaker stock trading; she said it was “100 percent” in response to the Pelosi stories, which were published Monday.
According to several sources, however, there’s plenty of private resistance—among Democrats and Republicans—to the idea that restructuring one’s portfolio is a worthy price to pay for restoring a bit of public trust in Congress.
“I have heard colleagues say things privately about this that they would be crucified for saying publicly. It’s really absurd,” said Huffman. “We have a lot of wealthy members of Congress with elaborate investment portfolios and, you know, I guess calling that a blind spot is being charitable.”
Huffman said he would be “shocked” if any stock trading ban “actually moves through all of the high-level institutional resistance in this body.”
Others feel that the Senate might be the more favorable environment to push forward—if they can get 10 GOP votes, according to a source familiar with ongoing talks there.
Schumer could perhaps be convinced to wrap up the talks soon and push to get a compromise bill on the floor, according to this source. From there, “if the Senate puts out its bill and passes it, Pelosi is going to be hard-pressed to kill it," the source said.
Republican votes may not be hard to come by. Some GOP lawmakers have indicated they’d gladly take up the issue and snatch Democrats’ win if they don’t do anything by January 2023, when a new GOP-majority Congress might take control.
Regardless of party, lawmakers are going to be held accountable for what they do—or don’t do—on this issue going forward, said Donald Sherman, the chief legal counsel at CREW, a nonpartisan ethics group that has pushed for a stock trading ban.
“This is a rare opportunity for a bipartisan win on ethics,” Sherman said. “It’s either something members of Congress are going to run on—or run from.”