Do members of Congress use political ”insider information” to get rich by trading stocks? The past few weeks have witnessed an uproar over investing practices in Congress following the publication of Peter Schweizer’s new book _Throw Them All Out_, which claims that members of Congress enrich themselves by engaging in a kind of insider trading that would be illegal for the rest of us. ut it is also important to understand what is being overlooked in the current uproar. Our own analysis of Congressional investment portfolios suggests that Congress’s critics are greatly overstating the extent to which politicians profit from their investing activities.Andrew Eggers (London School of Economics, Dept of Government) Jens Hainmueller (Massachusetts Institute of Technology, Dept of Political Science)
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Comments
do members of congress use insider information? well, let me put it thusly. WAS and the perjorative word is WAS, the late pontiff originally from that country that was somewhere between germany and russia? i was gonna use the expression" do pigs fly?" but, here in suffolk county, at least at city hall and the state house, they sure as hades do. ma
btw, who or whomever wrote this beaut really are a couple of ham and EGGERS. ma
Are you kidding me? Get real! How about at the state or city level. Our little town of Berwick, Maine has selectmen who approved the sale of a 4 apartment building to a fellow selectman's wife for $20,000. It goes on at all levels and we just ignore it. Not in Berwick. We are having a recall election and are going to kick the whole lot out.
I question the use of data from the 2004-2008 time period, a time that involved catastrophic loss for everyone. Someone heavily invested in up and coming issues, or speculative issues, the kind you can potentially make the most money from, would have experianced greater loss through this time period. An examination including a bull market, like the internet boom perhaps, may have been more pertinent.
Excellent piece! I don't think the authors are arguing against the existence of (or potential for) corruption at all levels of government; rather, they're reminding us that a rigorous approach to the facts is the best way to draft effective legislation, and to separate actual instances of abuse from paranoia.
When the congressional insider trading story came out a few weeks ago, I thought the evidence was that members of congress had investment performance that was so good that the only explanation was that they were cheating somehow. This story seems to contradict the statement that their investment results were extraordinary. Which is true? How can the Globe simply publish both stories without explaining the apparent contradiction?