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All the discussion about how much Senators and Representatives should be paid and whether it leads to bribery misses the most important moral point, which is:

All the discussion about how much Senators and Representatives should be paid and whether it leads to bribery misses the most important moral point, which is: They are in a position to influence stocks, and hence must be barred from owning them, other than in a blind trust. It's the same moral principle as "Judges must recuse themselves from cases in which they have a financial interest." We want them to vote on regulating Big Tech based on their understanding of the issues and their constituents' desires, not on their holdings of Big Tech stocks. Yes, I know that's naïve and there are campaign contributions to think of, but that's a separate topic of law. Discussing whether they get "enough" to live on also misses the fact that they're not doing it for living expenses -- they're doing it to get rich.

q1w2 5y ago
I have trouble with the escalation of demands being made on social media. Initially the titles talked about banning "insider trading", despite them not legally being insiders (which is a very specific legal term which refers to company employees/agents which specific non-public corporate information). The the titles talk about banning "day-trading", which is trading in-out of stocks multiple times per day. They are almost certainly NOT doing that. ...now you're saying they cannot even have any stock ownership - which would imply they cannot have a 401k or 529 for their kids (because those invest in funds) - or even a vanilla money-market savings account at any bank. Taking this logic further, they shouldn't be allowed to own any financial assets - bonds, real estate, etc... These arguments have lost touch with reality.
- UIUC_06 5y ago
  First of all, you're right about the title. The article is not about day trading, which confused me at first too. However, "insider" is often construed broadly as "possessing material, non-public information." For example, if you work at Google and you realize the next earnings are bad and you call your brother-in-law, who sells short, he can be prosecuted for violating insider trading laws. I think. Not just you. Now as to "you're saying they cannot even have any stock ownership" -- I didn't say that, I said "blind trust." This is a legal vehicle that's been used for public officials for generations. It means they can't influence it and they don't know how it's doing.
  - q1w2 5y ago
    Your example is not correct. Insiders in companies are specifically designated people. Top executives and anyone with access to material non-public financial information. Just being an employee does not make you an "insider". I regularly traded in the company I worked for. I did not have access to any financial information, so it was all based on my hunches of how sales were doing. There's nothing illegal about that. Moreover, you are not in violation of insider trading laws just for knowing insider information. You have to have received it from someone you knew was violating their insider status, or compensated them for such. For example, if you overhear someone in a bar talking about their sales numbers, and you trade on that - you are not guilty of insider trading.
    - UIUC_06 5y ago
      I didn't say being an employee made you an insider. However, many (most?) companies nowadays impose blanket trading restrictions for the month before earnings reports. I know Google does, and probably the other FAANGs as well. In my example, the brother-in-law would get caught and questioned, since the SEC actively watches for trades just before major moves in a stock. He could expect to be asked "why did you short Google?" I would not want to be in his shoes. And the employee could also expect to get asked why he called the BIL. Would the SEC go that far? They certainly could; whether they always do or not, it's "do you feel lucky?" Do you think we can't dig up examples where this has happened? In any case, the "blind trust" is the answer to conflicts of interest. Public officials have the ability to affect the fortunes of any private company by the performance of their duties, and that's why they're quite often required to use one.

q1w2 5y ago

I have trouble with the escalation of demands being made on social media. Initially the titles talked about banning "insider trading", despite them not legally being insiders (which is a very specific legal term which refers to company employees/agents which specific non-public corporate information). The the titles talk about banning "day-trading", which is trading in-out of stocks multiple times per day. They are almost certainly NOT doing that. ...now you're saying they cannot even have any stock ownership - which would imply they cannot have a 401k or 529 for their kids (because those invest in funds) - or even a vanilla money-market savings account at any bank. Taking this logic further, they shouldn't be allowed to own any financial assets - bonds, real estate, etc... These arguments have lost touch with reality.

UIUC_06 5y ago
First of all, you're right about the title. The article is not about day trading, which confused me at first too. However, "insider" is often construed broadly as "possessing material, non-public information." For example, if you work at Google and you realize the next earnings are bad and you call your brother-in-law, who sells short, he can be prosecuted for violating insider trading laws. I think. Not just you. Now as to "you're saying they cannot even have any stock ownership" -- I didn't say that, I said "blind trust." This is a legal vehicle that's been used for public officials for generations. It means they can't influence it and they don't know how it's doing.
- q1w2 5y ago
  Your example is not correct. Insiders in companies are specifically designated people. Top executives and anyone with access to material non-public financial information. Just being an employee does not make you an "insider". I regularly traded in the company I worked for. I did not have access to any financial information, so it was all based on my hunches of how sales were doing. There's nothing illegal about that. Moreover, you are not in violation of insider trading laws just for knowing insider information. You have to have received it from someone you knew was violating their insider status, or compensated them for such. For example, if you overhear someone in a bar talking about their sales numbers, and you trade on that - you are not guilty of insider trading.
  - UIUC_06 5y ago
    I didn't say being an employee made you an insider. However, many (most?) companies nowadays impose blanket trading restrictions for the month before earnings reports. I know Google does, and probably the other FAANGs as well. In my example, the brother-in-law would get caught and questioned, since the SEC actively watches for trades just before major moves in a stock. He could expect to be asked "why did you short Google?" I would not want to be in his shoes. And the employee could also expect to get asked why he called the BIL. Would the SEC go that far? They certainly could; whether they always do or not, it's "do you feel lucky?" Do you think we can't dig up examples where this has happened? In any case, the "blind trust" is the answer to conflicts of interest. Public officials have the ability to affect the fortunes of any private company by the performance of their duties, and that's why they're quite often required to use one.