SPEAKER of the US House of Representatives Nancy Pelosi’s residence in San Francisco was broken into in the early hours of Oct 28. Her husband, Paul Pelosi, was attacked. The incident occurred just over a week before polling day for the midterm elections, which attracted widespread public attention.
Paul is widely known not only because of this incident, nor for his identity of being Nancy’s husband, but for trading and investing in the stock market. Earlier this year, the US media discovered that Paul bought US$1 million (RM4.53 million) to US$5 million worth of shares of the US chip company Nvidia. This was only a few weeks before the US Congress voted on a Bill to subsidise the chip manufacturing industry. This made “insider trading” once again a focus of public attention.
In fact, Nancy’s past stock market investments have almost always yielded profit. In 2021, their average return on investments was 56%, which is better than “stock god” Warren Buffett. The US media, therefore, jokingly called Nancy the “Capitol Hill stock god” and “investment queen”.
As a matter of fact, the phenomenon of American government officials and Congress members using pre-acquired policy information to seek personal interests, turning Congress into a place to get rich is by no means limited to Nancy and her husband.
The Wall Street Journal reported the findings of an investigation that shows thousands of US government executive officials are reported to have held or traded stocks based on the information of their departments’ decisions.
Additionally, around 240 federal officials from health agencies and the Department of Defence, a key player in the vaccine rollout, own stocks worth US$28 million in drug, manufacturing and biotech companies. These companies have federal contracts related to the Covid-19 pandemic in 2020 and 2021.
The New York Times also disclosed recently that from 2019 to 2021, nearly 100 members of the US Congress had been suspected of using their powers to obtain inside information when trading stocks and securities. With their knowledge of the changes in policy, they can find the right time to buy and sell stocks and make a fortune.
The Covid epidemic and the Ukraine crisis are all business opportunities in the eyes of these “stock gods”. At the beginning of 2020, when Covid began to break out on a large scale, several US senators, including US Republican Senator Richard Burr, the chairman of the Senate Intelligence Committee, broke scandals when he failed to report the seriousness of the epidemic when selling out stock shares.
The American media questioned whether these congressmen took advantage of their positions to obtain relevant information in advance. They also sold their holdings before the US stock market plummeted, which caused dissatisfaction among the American people. Burr and other officials were heavily criticised by the public because of their actions.
The US introduced a law in 2012 that prohibits members of Congress and staff from using non-public information for personal gain. US media reported that a total of three senators voted against the Bill that year, including Burr who is the only one still in office among the three naysayers.
“Insider information” has been used by members of Congress to trade stocks and fund presidential and parliamentary campaigns, and this illustrates that American democracy is “money democracy” and “money-government politics” representing the interests of the rich. Many of the members of the US Congress are millionaires, and many of them are running for re-election. Therefore, it is clear who is served by the US authority decision-making process.
The well-informed US lawmakers who turned their professional information into personal gains violated not only the federal securities laws but also undermined the public’s trust and confidence in the fairness of the market.
Although most of the American people support the ban on congressional stock speculation and call on the Congress to stop this phenomenon, most members of the Republican and Democratic parties have stood up to oppose it. Nancy even publicly expressed her opposition. There have been voices within the US Congress calling for a ban on lawmakers from stock trading, but Nancy has publicly opposed it many times.
At the beginning of this year, 27 members of the House of Representatives jointly asked for a vote on a proposal to prohibit lawmakers from holding shares. After years of opposing the legislation, Nancy has now changed her mind and stated that she is open to advancing it. But so far, all proposals to restrict stock trading have remained in the discussion stage, and none of them have been brought to the floor for a vote.
American politicians make hype before elections, and then throw the people aside afterward. People in power speculate, gather wealth through illegal means, and tout “American democracy” as a noble concept. But people can clearly see that American democracy is overridden by money as soon as the veil is lifted.
Wei Kaixing, senior media worker in Hong Kong.
