Stop Trading on Congressional Knowledge Act of 2012
Floor Speech
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Mr. GRASSLEY. Madam President, the Wall Street Journal recently reported that political intelligence is an approximately $100 million industry. The article also says that expert networks employ over 2,000 people to do political intelligence in Washington, DC.
We have to say approximately because no one truly knows how many people work in this industry. We don't know from whom they seek information, what happens to that information, and how much they get paid. This is a problem if one believes in transparency in government and if one believes in the purposes behind this legislation, as I do--the underlying legislation--that Members of the Senate and Congress should not benefit from insider trading information.
So we have people in this city or people who come into this city to get information on what Congress might do or what their regulators might do that might affect the stock in some company or something, and this political intelligence information is gathered and given to people who presumably profit from it or I guess these people wouldn't be employed in the first place. So there is a growing unregulated industry with no transparency. If a lobbyist has to register in order to advocate for a school or a church or a private corporation, shouldn't the same lobbyist have to register if he or she is seeking and getting inside information that ends up in making people a profit? This is especially true if that information would make millions for a hedge fund or a private equity firm.
We have current law. Under current law, this is not the case. We have no registration of these people and we don't know who they are. So we go back to amendment No. 1493. My amendment merely brings sunlight to this unregulated area. It defines what a political intelligence lobbyist is and requires that person or firm to register. In other words, it requires them to do what, under the 1995 law, every lobbyist has to do.
I understand some would say there have not been hearings on this subject and that it should be studied first. But there isn't much that is complicated about this amendment. It is pretty simple. If a person seeks information from Congress in order to make money, the American people have a right to know the name of that person and who that person is selling that information to. That is just pretty basic good government, isn't it? It is the same as if a person is a lobbyist for a piece of legislation under laws going back to 1946 and amended since then, they have to register. The public has a right to know who the lobbyist is, whom they are working for, and what they are lobbying for or against.
This amendment isn't just helpful to the American people, though. It isn't just helpful to make people responsible, because the more transparency we have the more accountability there is and the more openness we have in government the better off we are. So I make a case to help the American people, yes. But it is also going to help Members of Congress and our staff who are trying to decipher their duties under this proposed legislation.
Senators have raised the question: How will we know if the people we speak to trade on what we say? So to answer that question, we require the people doing it to be responsible. So we achieve more transparency in government, and we even help Members of Congress and our staff because these political intelligence people are pretty smart. They know where to get the information because they come to us and ask questions, but we might not know why they are asking the questions. So it is going to help Members of Congress and our staff as well. By requiring lobbyists who sell information to stock traders to register, Members and staff then have an easy way to track who these people are and to whom they would sell their information. This strengthens the bill, from my point of view, and helps Members and staff comply with its requirements.
So I hope we can pass this amendment soon and bring light and transparency to this growing industry and, when we are talking to someone, know who they are, what they seek, whom they are working for, et cetera.
With that, I yield the floor, and I suggest the absence of a quorum.
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Mr. GRASSLEY. This is a good government amendment. Similar to the underlying piece of legislation, it is a good government amendment. The manager is going to tell you it ought to be studied a little bit longer. We have gone for far too long not having enough transparency in government. What my amendment does is it takes these people whom you call political intelligence professionals and has them register just like every lobbyist registers, so it is totally transparent when these people come around to get information from you that they sell to hedge funds. You will know who they are. You don't know that now, and transparency in government is very important if you want accountability.
For the Senators and their staffs who have to abide by these laws, they want to make sure they are not doing anything unethical. They have to know who these people are. They can come around and ask us questions. I don't know how many times each of us has maybe been caught up in this. You give them information, and they have information that people don't have on Wall Street and they sell it. We ought to know what we are being used for, and this gives identity to these people. So I want these people registered like lobbyists.
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