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[Rentahamster]

Relevant considering the recent developments of protesting unfair Wall Street practices (Occupy Wall Street) and the corrupting influence of too much unchecked government power (Tea Party)

Both Democrats and Republican get scrutinized in this report.

Written article: http://www.cbsnews.com/8301-18560_162-57323527/congress-trading-stock-on-inside-information/

Main story (video): http://www.cbsnews.com/video/watch/?id=7388130n

Challenges faced during the investigation (video): http://www.cbsnews.com/8301-504803_...eads-to-d.c/?tag=contentBody;currentVideoInfo

Keeping Congress clean (video): http://www.cbsnews.com/video/watch/?id=7388132n

What counts as "insider information" (video): http://www.cbsnews.com/video/watch/?id=7388134n

Schweizer: There are all sorts of forms of honest grafts that congressmen engage in that allow them to become very, very wealthy. So it's not illegal, but I think it's highly unethical, I think it's highly offensive, and wrong.

Steve Kroft: What do you mean honest graft?

Schweizer: For example insider trading on the stock market. If you are a member of Congress, those laws are deemed not to apply.

Kroft: So congressman get a pass on insider trading?

Schweizer: They do. The fact is, if you sit on a healthcare committee and you know that Medicare, for example, is-- is considering not reimbursing for a certain drug that's market moving information. And if you can trade stock on-- off of that information and do so legally, that's a great profit making opportunity. And that sort of behavior goes on.

The buying and selling of stock by corporate insiders who have access to non-public information that could affect the stock price can be a criminal offense, just ask hedge fund manager Raj Rajaratnam who recently got 11 years in prison for doing it. But, congressional lawmakers have no corporate responsibilities and have long been considered exempt from insider trading laws, even though they have daily access to non-public information and plenty of opportunities to trade on it.

Schweizer: We know that during the health care debate people were trading health care stocks. We know that during the financial crisis of 2008 they were getting out of the market before the rest of America really knew what was going on.

Schweizer: If you were a senator, Steve, and I gave you $10,000 cash, one or both of us is probably gonna go to jail. But if I'm a corporate executive and you're a senator, and I give you IPO shares in stock and over the course of one day that stock nets you $100,000, that's completely legal.

Baird: One line in a bill in Congress can be worth millions and millions of dollars. There was one night, we had a late, late night caucus and you could kind of tell how a vote was going to go the next day. I literally walked home and I thought, 'Man, if you-- if you went online and made-- some significant trades, you could make a lot of money on this.' You-- you could just see it. You could see the potential here.

So in 2004, Baird and Congresswoman Louise Slaughter introduced the Stock Act which would make it illegal for members of Congress to trade stocks on non-public information and require them to report their stock trades every 90 days instead of once a year.

Kroft: How far did you get with this?

Baird: We didn't get anywhere. Just flat died. Went nowhere.

Primary sources -

Peter Schweizer, conservative with the Hoover Institute. http://en.wikipedia.org/wiki/Peter_Schweizer

Brian Baird, former Democratic member of congress. http://en.wikipedia.org/wiki/Brian_Baird

Previous GAF threads about the subject of insider trading: http://www.neogaf.com/forum/searchr...=www.neogaf.com/forum/showthread.php?t=331180

 

[Rafa=FedKilla]

This was a great segment last night and the Tazer segment made me want to throw up.

 

[kame-sennin]

Disgusting.

 

[Something Wicked]

 

[Cyan]

For example insider trading on the stock market. If you are a member of Congress, those laws are deemed not to apply.

wtf

 

[OpinionatedCyborg]

congressmen have a very difficult job. perks such as these make it worthwhile. if we want the best and the brightest to go into politics, you can't take incentives like this away from them.

 

[Ferrio]

congressmen have a very difficult job. perks such as these make it worthwhile. if we want the best and the brightest to go into politics, you can't take incentives like this away from them.

....

 

[sonicfan]

Criminals, almost every last one of them....

 

[GhaleonEB]

wtf

If memory serves, this is literally true, Congress is exempted from the law. I remembe reading about it a few years ago. Anyone have some data/information on it?

Crooks and liars, for the most part.

congressmen have a very difficult job. perks such as these make it worthwhile. if we want the best and the brightest to go into politics, you can't take incentives like this away from them.

Tried too hard.

 

[Lactose_Intolerant]

This should be an Occupy Wallstreet demand. Something everyone can get behind. The president needs to get behind this too. Instant votes for him.

 

[demon]

congressmen have a very difficult job. perks such as these make it worthwhile. if we want the best and the brightest to go into politics, you can't take incentives like this away from them.

Not only is it a difficult job, but they work practically year-round! Cut them some slack.

 

[Ether_Snake]

Said it before, all portfolios of congressmen must be public.

 

[~Kinggi~]

Said it before, all portfolios of congressmen must be public.

It would be too sickening to handle.

 

[Rentahamster]

The president needs to get behind this too. Instant votes for him.

You sure about that?

http://www.opensecrets.org/pres08/contrib.php?cid=N00009638

University of California $1,648,685
Goldman Sachs $1,013,091
Harvard University $878,164
Microsoft Corp $852,167
Google Inc $814,540
JPMorgan Chase & Co $808,799
Citigroup Inc $736,771
Time Warner $624,618
Sidley Austin LLP $600,298
Stanford University $595,716
National Amusements Inc $563,798
WilmerHale LLP $550,668
Columbia University $547,852
Skadden, Arps et al $543,539
UBS AG $532,674
IBM Corp $532,372
General Electric $529,855
US Government $513,308
Morgan Stanley $512,232
Latham & Watkins $503,295

http://articles.cnn.com/2010-04-20/...al-election-commission-figures?_s=PM:POLITICS

http://www.huffingtonpost.com/preeti-vissa/obama-goldman-sachs_b_942633.html

One of the firm's biggest bets has been on Barack Obama, and that bet seems to be paying off too.

The "vampire squid" raised more money for Obama's 2008 presidential campaign than any other bank or Wall Street firm, over $1 million from Goldman employees, officers, etc. If the goal was to gain access to the White House, the plan seems to have been wildly successful.

 

[Technosteve]

i want to be a senator or a representative, any rich billionaire on gaf want to bank roll me

 

[Rentahamster]

Also interesting to note Goldman Sach's "recipients" page and how the balance shifts between Democrat and Republican (but is still heavily tilted towards the incumbents, obviously) depending on the political tradewinds.

http://www.opensecrets.org/orgs/toprecips.php?id=D000000085&cycle=2012

 

[arglebargle]

arent there rules about what stocks politcal appointees can own (or possibly trade)? i remember when paulsen became secretary of the treasury he had to put his fortune in a blind trust (and possibly divest some of his goldman shares?) since he was going to be so involved in overseeing that industry. now you are telling me that members of congress, who regulate every industry, have no restrictions?

for the record, i worked for an investment firm and didnt even have insider information on anything, but was restricted from owning individual stocks at all. we were only allowed to invest in mutual funds or index funds.

edit - i should mention this was self imposed company policy to avoid anything that could have been interpreted as impropriety rather than a law. just realized how that could have been interpreted.

 

[Rafa=FedKilla]

What the hell at a public university donating that much.

 

[dave is ok]

Good to see this story getting a lot of attention

 

[GaimeGuy]

What the hell at a public university donating that much.

it's not the unversity contributing, but people who work AT the university.

If you work for, say, Boeing as an engineer, and you decide to donate $500 to Obama's campaign... you have to disclose that you are an employee of Boeing.

That shows up in these kinds of reports as +$500 to Boeing contributions to obama's campaign, even though it has nothing to do with boeing.

The issue is when you get into the executive/management level for donations.

 

[Atrus]

My personal preference would be a temporary freeze on all investment actions undertaken by politicians and their immediate families for the duration of their time in office and then a permanent bar from any activity associated with their post.

This means that they could not serve on any corporate board whose industry has or could have been affected by decisions made while elected, or invest in such companies, or profit personally as a direct result of their time in office.

The last means that no former politician can receive a profit from exploiting the fame received from earning a political posting. They can donate the proceeds and such but they cannot profit personally from it.

 

[Rentahamster]

What the hell at a public university donating that much.

It's not the university itself. It's the combined total of the contributions of the people who work there.

 

[balladofwindfishes]

Baird and Congresswoman Louise Slaughter introduced the Stock Act which would make it illegal for members of Congress to trade stocks on non-public information and require them to report their stock trades every 90 days instead of once a year.

Keep fighting the good fight my district's rep

 

[Funky Papa]

Schweizer: For example insider trading on the stock market. If you are a member of Congress, those laws are deemed not to apply.

Schweizer: If you were a senator, Steve, and I gave you $10,000 cash, one or both of us is probably gonna go to jail. But if I'm a corporate executive and you're a senator, and I give you IPO shares in stock and over the course of one day that stock nets you $100,000, that's completely legal.

What is this? How? Why? WTF?

 

[s7evn]

What is this? How? Why? WTF?

Those who make the rules decide how the game is played. As unfortunate as it is.

 

[Rentahamster]

Those who make the rules decide how the game is played. As unfortunate as it is.

Rep. Jefferson wasn't paying attention in class, apparently.


Congressman who had cash in freezer is convicted of 11 criminal counts

http://articles.latimes.com/2009/aug/06/nation/na-jefferson6

 

[Cloudy]

You sure about that?

http://www.opensecrets.org/pres08/contrib.php?cid=N00009638



http://articles.cnn.com/2010-04-20/...al-election-commission-figures?_s=PM:POLITICS

http://www.huffingtonpost.com/preeti-vissa/obama-goldman-sachs_b_942633.html

This is misleading. That money is given by private citizens who happen to work in those places. There is nothing wrong with that.

IMO this 60 minutes piece insinuates a lot but if you look at it deeply, it's crap. I don't like Boehner at all but do people really think he wanted the public option dead to make money? Republicans just don't like it! And the Pelosi stuff is really stupid. Rich people get access to IPOs and that legislation (that she supported!) was more of a threat to banks/credit-card issuers not payment processing companies (Visa)...

I'm not saying there aren't slimy pols but their 2 main examples are just dumb

 

[kame-sennin]

My personal preference would be a temporary freeze on all investment actions undertaken by politicians and their immediate families for the duration of their time in office and then a permanent bar from any activity associated with their post.

This means that they could not serve on any corporate board whose industry has or could have been affected by decisions made while elected, or invest in such companies, or profit personally as a direct result of their time in office.

The last means that no former politician can receive a profit from exploiting the fame received from earning a political posting. They can donate the proceeds and such but they cannot profit personally from it.

What about real estate deals? Are we going to decide that congresspeople can't buy property? I'm not saying this to criticize your suggestions, just pointing out how deep the corruption runs.

 

[kame-sennin]

This is misleading. That money is given by private citizens who happen to work in those places. There is nothing wrong with that.

Your post is misleading:

This table lists the top donors to this candidate in the 2008 election cycle. The organizations themselves did not donate , rather the money came from the organization's PAC, its individual members or employees or owners, and those individuals' immediate families. Organization totals include subsidiaries and affiliates.

Because of contribution limits, organizations that bundle together many individual contributions are often among the top donors to presidential candidates. These contributions can come from the organization's members or employees (and their families). The organization may support one candidate, or hedge its bets by supporting multiple candidates. Groups with national networks of donors - like EMILY's List and Club for Growth - make for particularly big bundlers.

 

[Rentahamster]

That money is given by private citizens who happen to work in those places. There is nothing wrong with that.

Yes, I know that. We even had this clarification earlier in the thread.

I don't like Boehner at all but do people really think he wanted the public option dead to make money? Republicans just don't like it!

But when a person in a position of power has influence over decisions that will significantly impact the amount of money he/she makes, that is a conflict of interest. Small ones might not be so bad, but we are talking about some huge conflicts of interest here.

http://www.cbsnews.com/video/watch/?id=7388132n

"That invites abuse, and the invitation of abuse invites disdain for the insitution"

 

[Cloudy]

Very few companies want the reputation of being for one political party. I bet if you looked deeper, any cash that wasn't from individuals was similarly given to the other party as well. I stand by my point. They may be rich private citizens but a lot of the money listed on opensecrets is from individuals. When companies want to give money, they don't make it easy to trace

Take a look:

http://www.opensecrets.org/pres12/candidate.php?id=N00009638

 

[Kifimbo]

Pelosi was shaking when she answered that question during the press conference.

 

[Cloudy]

But when a person in a position of power has influence over decisions that will significantly impact the amount of money he/she makes, that is a conflict of interest. Small ones might not be so bad, but we are talking about some huge conflicts of interest here.

http://www.cbsnews.com/video/watch/?id=7388132n

"That invites abuse, and the invitation of abuse invites disdain for the insitution"

I agree with that and support the proposed legislation. I just don't like the gotcha games CBS was playing with Boehner and Pelosi. It was disgraceful...

 

[GaimeGuy]

Your post is misleading:

no, it's not. If you want to provide information about corporate expenditures on elections, give the PACfigures separately from the individual contributions.

 

[a176]

right

and what will come from this investigation?

nothing

like they say in the very article
they are exempt from the law

 

[Rentahamster]

I just don't like the gotcha games CBS was playing with Boehner and Pelosi. It was disgraceful...

They asked them if their stock transactions during a time of legislative debate that would have an impact on those same stocks would be a conflict of interest. In the wide world of "gotcha" questions that tend to stretch the truth of the context, this one isn't that bad.

 

[jchap]

Finally something bipartisan!

 

[Phoenix]

i want to be a senator or a representative, any rich billionaire on gaf want to bank roll me

If you give me kickbacks and concessions I'll toss you a few dollars

 

[kame-sennin]

I agree with that and support the proposed legislation. I just don't like the gotcha games CBS was playing with Boehner and Pelosi. It was disgraceful...

CBS asked them to come to sit-down interviews, but they declined, so CBS had to interview them at press conferences. Pelosi even agreed to call on them, so she was hardly pounced on. And the questions were more than fair. They made money on investments while having access to sensitive, non-public information. The logical question is whether those two things are connected.

 

[makingmusic476]

The look on Pelosi's face after she was asked that question...

Talk about calling her out.

 

[Liu Kang Baking A Pie]

You guys should just get real jobs instead of whining all the time. $8 an hour at the mall for a few years and you'll be rich just like them!

 

[Dead Man]

Ugh. Fucking human nature, what a bitch.

 

[epmode]

This story blew my mind. I've been reading up on banking/government financial corruption for a while now yet I had no idea that Congress had an exemption to these laws.

Please change the thread title to something like "60 Minutes: Insider trading legal for US Congress" so people pay more attention.

 

[Rentahamster]

Please change the thread title to something like "60 Minutes: Insider trading legal for US Congress" so people pay more attention.

The reason I wrote the title as such is because I'm not a fan of sensationalist thread titles, especially after seeing a bunch of them recently that took the subject matter out of context.

Granted, "60 Minutes: Insider trading legal for US Congress" is actually still fairly accurate, but still.

 

[sangreal]

You sure about that?

http://www.opensecrets.org/pres08/contrib.php?cid=N00009638



http://articles.cnn.com/2010-04-20/...al-election-commission-figures?_s=PM:POLITICS

http://www.huffingtonpost.com/preeti-vissa/obama-goldman-sachs_b_942633.html

This has always been the stupidest measure of corporate support for a candidate, as if employees get a memo demanding they donate to a candidate for the good of the company. There are far easier ways for corporations to buy what they want in the political system.

 

[Rocket Scientist]

Yea, I'm mad.

 

[Ezduo]

For what it's worth the Huffington Post did an article detailing why a few of the claims in this piece weren't fair:
http://www.huffingtonpost.com/2011/11/14/60-minutes-pelosi-boehner_n_1091656.html

 

[BananaBomb]

this is absolutely sickening.

 

[Cyan]

For what it's worth the Huffington Post did an article detailing why a few of the claims in this piece weren't fair:
http://www.huffingtonpost.com/2011/11/14/60-minutes-pelosi-boehner_n_1091656.html

Sounds reasonable. But I'm more worried about the free insider trading thing than those vague allegations in any case.

 

[Myansie]

For what it's worth the Huffington Post did an article detailing why a few of the claims in this piece weren't fair:
http://www.huffingtonpost.com/2011/1...n_1091656.html

If they are as innocent as the Huffington says, why did both politicians refuse interviews? If politicians aren't giving interviews to the media they will naturally jump to their own conclusions. They have to write a story.

Honest graft, as "60 Minutes" calls it, is a serious problem in Washington, with a massive industry called "political intelligence" devoted to digging up inside regulatory and congressional information so traders and companies can take advantage of it.

But by swinging and missing at Boehner and Pelosi, "60 Minutes" undermined its case.

It sounds like there is a real problem with companies gaining information from party caucus meetings. Rather than politicians taking advantage of said information. It gives these companies, particularly Hedge Funds and Banks, a very large advantage over the rest of the population.