Lawmakers Profit From Affected Companies, ‘60 Minutes’ Says
Members of Congress, including the current House speaker and his predecessor, bought stock in companies while legislation that might affect those businesses was being debated, the CBS news program “60 Minutes” reported.
The program also said that during the 2008 financial crisis, Representative Spencer Bachus, an Alabama Republican who was then the ranking member and now is chairman of the House Financial Services Committee, bet that stock prices would fall while being privately briefed that a global financial meltdown might be imminent.
None of the questioned investments were illegal, the news program said. Federal insider-trading laws don’t apply to members of Congress, “60 Minutes” said, citing Peter Schweizer, a fellow at the Hoover Institution at Stanford University.
The report said that John Boehner, the Republican House speaker from Ohio, bought health insurance stock in 2009 just days before lawmakers killed a proposal to create a so-called public option, government-funded insurance that would compete with private companies. Boehner at the time was House minority leader.
In response to a question from “60 Minutes” at a Nov. 3 press conference, Boehner said that “I have not made any decisions on day-to-day trading activities in my account and haven’t for years.” His spokesman later told “60 Minutes” that the trades were made by Boehner’s financial adviser, with whom the speaker consults only once a year.
The television program said former House Speaker Nancy Pelosi and her husband participated in eight initial public offerings -- including Visa Inc. (V), the credit-card company that rose from $44 a share to $64.35 in the two days after it went public in 2008. At the time, the House was considering major legislation affecting the credit card industry. Pelosi’s financial disclosure form for 2008 said her husband Paul, and not the congresswoman, participated in the Visa IPO.
Pelosi, a Democrat from California, said at a Nov. 3 press conference that her involvement didn’t create a conflict of interest. Responding to a question from “60 Minutes,” she said questions about her stock purchases were based on a “false premise.”
“I will hold my record in terms of fighting the credit card companies as speaker of the House up against anyone’s,” she said, according to the report.
House Majority Leader Eric Cantor, a Virginia Republican, told reporters today that, like Boehner, he doesn’t trade in his own account. Cantor said he favored “full disclosure in a timely manner” of lawmakers’ investments. Under current law, members of Congress are required to file a financial disclosure form every May for the preceding calendar year. Paul Pelosi’s Visa stock purchases weren’t disclosed for more than a year after they occurred in March 2008.
Pelosi’s office issued a statement yesterday saying, “It is very troubling that ‘60 Minutes’ would base their reporting off of an already-discredited conservative author who has made a career out of attacking Democrats.”
Schweizer’s books include “Do as I Say (Not as I Do): Profiles in Liberal Hypocrisy,” and “Architects of Ruin,” according to Schweizer’s page on the Hoover Institution website.
Bachus was among the lawmakers briefed privately by Federal Reserve Chairman Ben Bernanke and then-Treasury Secretary Hank Paulson and during the 2008 financial crisis. The news magazine said Bachus profited from a number of trades he made around that time.
In a statement, Bachus’s office said he never trades on non-public information, “60 Minutes” reported. The news program said Bachus’s financial disclosure forms indicate he made money trading shares of General Electric Co. (GE), a financial- services company, during the period in question.
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