House Speaker Nancy Pelosi (D-Calif.) has defended elected representatives and their spouses who play the stock market following an alarming report on the dozens of lawmakers who bought and sold health care stock during the pandemic.
At least 75 lawmakers invested their own money in companies that have been key to the United States’ response to COVID-19, according to Insider, which began publishing its findings Monday.
“We are a free-market economy,” Pelosi said Wednesday. “They should be able to participate in that.”
It’s not hard to see why she might feel that way. The California Democrat’s husband, Paul Pelosi, is a venture capitalist who made a cool $5 million this summer through big-tech stock shortly before a House vote on antitrust legislation.
According to Insider, dozens in Congress held stock in Johnson & Johnson and Pfizer in 2020, while the legislative branch doled out billions to help the pharmaceutical industry accelerate the time it takes to make a vaccine. Members also bought and sold stock in health care companies like 3M, which makes personal protective equipment, and Quest Diagnostics, which manufactures coronavirus tests, the outlet reported.
The report has added fuel to criticisms that lawmakers making money off the stock market amounts to insider trading, due to their access to information while in government.
Of course, the revelations are not brand new. Sens. Richard Burr (R-N.C.) and Kelly Loeffler (R-Ga.) caused an uproar in late March 2020 for dropping a large amount of stock right after private health briefings that suggested COVID-19 was about to become a massive problem. Rep. Tom Malinowski (D-N.J.) was also criticized for trading as much as $1 million in coronavirus-related stock.
But the Insider report helps illustrate the extent that lawmakers are attempting to game the market during the pandemic in what could be a violation of the 2012 Stock Act, which prohibits members from using inside information in their investment decisions.
New York Times financial columnist Andrew Ross Sorkin laid into Pelosi during a Thursday morning segment on MSNBC, calling her remark “one of the most disappointing and ... disgraceful comments in views I have heard espoused on this issue.”
“We have insider trading laws for a reason. CEOs, executives cannot trade. Members of the Federal Reserve now cannot trade,” Sorkin said. “And yet we are allowing our politicians, who do have access to inside information, they are often briefed regularly about all sorts of things that are about to happen and that they have a meaningful influence on what is about to happen and they are trading.”
He added: “To the extent that politicians should want the public to trust them, this undermines every bit of trust.”
MSNBC’s Stephanie Ruhle was more succinct: “This isn’t about free markets. This is about having privileged information and using it to your own personal advantage.”