Rep. Krishnamoorthi on the 'Ban Conflicting Trading Act'
Yahoo Finance’s Julie Hyman, Brian Sozzi, Myles Uldand, and Jessica Smith speak with U.S. Representative Raja Krishnamoorthi about the latest in what's happening in Washington, D.C.
Video Transcript
JULIE HYMAN: Well, there's a law that was signed by former President Obama making it illegal for members of Congress to trade on non-public data. Now there is a new bill that would not allow members of Congress to trade stocks, most bonds, and options contracts as well while they are members of Congress. That bill co-sponsored by Representative Raja Krishnamoorthi from Illinois, Democrat of Illinois. Our Jessica Smith is joining us as well as the Congressman here this morning.
Congressman, thank you for being here. So this obviously goes beyond the scope of the Stock Act. Why do you think something like this is necessary, and how likely do you think it is that you'll be able to get it through?
RAJA KRISHNAMOORTHI: Well, thanks so much for having me on, Julie. I think it's necessary because unfortunately, what we're seeing is that a lot of members of Congress are still buying and selling individual stocks. And if it isn't a reality, there's a very strong appearance of basically trading based on non-public information that they gain from their investigations, their hearings, and their private briefings, which aren't available to the public.
Just recently, we had a few senators, including Senator Richard Burr and Senator Loeffler and Senator Perdue, who dumped millions of shares of stock based on briefings that they had during the pandemic or right after, around the time of private briefings. And that created tremendous appearances of conflicts of interest. And I think that's just wrong. And so we have to pass this legislation. I'm glad that we have Republicans and Democrats supporting this, and I think that we have a chance of passing it in the House.
JESSICA SMITH: Hi, Congressman. I knew a couple of things like this have been brought up in years past. I guess, why is it different now? Do you think it is different now as far as the chances of getting this signed into law?
RAJA KRISHNAMOORTHI: Well, I think that what's different now is that we have some bipartisan support. It's also bicameral. I should say that Senator Jeff Merkley in the Senate has really led the way. And I think that there's also a growing, I guess, awareness on the part of voters about what's been happening on Capitol Hill in this regard. And I think that they're demanding that we make these changes.
A recent poll showed that almost 70% of voters, so a large bipartisan majority of the electorate, wants this change. They want their public servants not to be trading individual shares of stock at the public's expense.
JESSICA SMITH: I know you mentioned those senators who were investigated last year. They were cleared. They weren't charged with anything. I guess, do you really think that there is a problem here that members are using their positions to make money, or are you more concerned with the appearances?
RAJA KRISHNAMOORTHI: I think both. And one of the reasons why folks are routinely cleared is because the law that's currently on the books-- it's called the Stock Act-- has such a high threshold of what is required in order to establish intent with regard to why people traded their stock that it's nearly impossible to find people guilty under that particular statute.
In any case, I think people already assume that a lot of these shares of stock, whether it's in reality the case or not, were traded based on non-public information, especially when they were traded so close in time to non-public briefings, and what they learned through investigations, and so forth.
JULIE HYMAN: Congressman, I want to turn to stimulus for just a moment. I know that you all are not in session today because of some security risks, potentially, against the House. The Senate, though, it looks like, is not going to be voting on stimulus before the weekend. There are several reported tactics that Republicans might take in order to delay. I know the Democrats have set a deadline of March 14. Are you going to make that deadline? Are Democrats going to make that deadline for passage?
RAJA KRISHNAMOORTHI: Yes. We have no choice because unemployment benefits run out for 11 million Americans on March 14. And so we have to meet that deadline. My constituents call every day and communicate with me every day about the need for the very important parts of this package, whether it's the stimulus checks, whether it's the extension of unemployment benefits, or whether it's the aid to those struggling businesses that are really hurting right now. And so we need to get them this aid, and we need to get America healthy as well as economically healthy.
JESSICA SMITH: Congressman, the Senate is making some changes to the direct payments, lowering the income caps for people who are eligible for those checks. What do you think about those changes, and do you worry that this may cost some progressive votes in the House?
RAJA KRISHNAMOORTHI: I think that there were bound to be some changes going through the Senate. I think these particular changes are not ones that are going to cause a lot of people to not vote for the overall package in the House when it comes back. I think at the end of the day, the stimulus checks are going to go to the bulk of the people who really need them. And I think that's really important because what they're going to do with those checks is very simple. They're going to spend that money, and they're going to get that money into the hands of more people and multiply the effect of those stimulus checks to really boost the economy and help our struggling businesses as they ride out this economic storm.
JULIE HYMAN: Congressman, thanks so much for your time today. Really appreciate it. Representative Raja Krishnamoorthi, a Democrat of Illinois, and our Jessica Smith as well. Thank you so much, Congressman. Appreciate it.
