While Congress might be stuck in a deadlock on just about every issue imaginable, there’s one piece of legislation that both Democrats and Republicans hate unanimously: the Stop Trading on Congressional Knowledge (STOCK) Act, a law passed last year designed to prevent insider trading among lawmakers and government officials by requiring them to post disclosures of their financial transactions online.
Both parties and both houses of Congress hated the disclosure portion of the law so much that it was repealed on Friday without debate—the measure was sent to the president by unanimous consent. The ordeal took about 10 seconds in the Senate and 14 seconds in the House, according to official records.
The STOCK Act would have required members of Congress, their aides, and other federal employees making more than $119,554 a year to disclose their financial dealings in an online database. It was supposed to prevent government officials from using insider knowledge about policy-making to profit from stock trades and other investments.
Upon the signing of the bill into law last year (pictured above), President Barack Obama said, “The idea that everybody plays by the same rules is one of our most cherished American values. It’s the notion that the powerful shouldn’t get to create one set of rules for themselves and another set of rules for everybody else, and if we expect that to apply to our biggest corporations and to our most successful citizens, it certainly should apply to our elected officials—especially at a time when there is a deficit of trust between this city and the rest of the country.” The White House has not said whether the president will sign the repeal.
Despite the repeal, government officials will still have to file disclosures of securities trades over $1,000 within 45 days, but they no longer have to file them in a searchable database that was to be easily accessible to the public.
Congress and the President had delayed the online posting portion of the act from going into effect 3 times already, but the ultimate repeal came after the National Academy of Public Administration, a nonprofit group, found that publishing the information would create an “unwarranted risk to national security and law enforcement, as well as threaten agency missions, individual safety and privacy,” in a report delivered last month. The group suggested that the online posting requirements should be suspended indefinitely.
Lisa Rosenberg of the Sunlight Foundation, a nonprofit group advocating for government transparency, said that the repeal “sets an extraordinarily dangerous precedent suggesting that any risks stem not from information being public but from public information being online.”
Rosenberg raises an interesting point: Since these financial disclosures are still considered public information, how does not posting them on the Internet mitigate their potential risks to national security? How does obfuscating information about the financial activities of government officials help anyone, other than those officials? Does the potential danger come from foreign terrorists knowing this information or from those citizens who just to know if their government officials are behaving responsibly?
UPDATE: White House spokesperson Jay Carney announced that Obama has signed the repeal of the internet disclosure portion of the STOCK Act.