Senate approves bill banning insider trading by lawmakers, 96-3

The Senate voted 96 to 3 Thursday to prohibit members of Congress from using non-public information for personal financial gain but beat back a slew of amendments to further limit congressional perks.

The Senate action puts pressure on House Republicans to pass similar legislation to quell allegations of congressional self-dealing at a time when Congress’s approval rating is at an all-time low.

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House Majority Leader Eric Cantor (R-Va.) on Tuesday criticized the Senate legislation as weak. His staff said he would move a strengthened version of the bill to the House floor at the end of the month.

Senators voted for an amendment Thursday to expand the legislation’s reporting requirements to members of the executive branch.
 
The legislation would mandate that lawmakers report all major transactions within 30 days and file financial disclosure reports electronically.

But lawmakers defeated several proposals to significantly reform the perks and powers critics charge have a corrupting influence on Capitol Hill.

Senators voted down a bipartisan proposal to permanently ban earmarks as well as an amendment to require lawmakers and senior staff to divest of stocks or put their stock holdings in blind trusts.

The amendment sponsored by Sens. Claire McCaskill (D-Mo.) and Pat Toomey (R-Pa.) to permanently ban earmarks failed by a vote of 40-59.

A solid block of Republicans, including Sens. Lamar Alexander (Tenn.), Roy Blunt (Mo.), Thad Cochran (Miss.), Susan Collins (Maine), John Hoeven (N.D.), Kay Bailey Hutchison (Texas), James Inhofe (Okla.), Dick Lugar (Ind.), Lisa Murkowski (Alaska), Pat Roberts (Kan.), Jeff Sessions (Ala.), Richard Shelby (Ala.) and Roger Wicker (Miss.), voted to preserve Congress’s future power to earmark federal funds.

The amendment sponsored by Sens. Sherrod Brown (D-Ohio) and Jeff Merkley (D-Ore.) requiring lawmakers and senior staff to divest of stocks lost 26 to 73.

Senate leaders denied Sen. Rand Paul (R-Ky.) a vote on an amendment to deny federal pensions to lawmakers who become lobbyists.

The anti-lobbying amendment raised the hackles of some senior lawmakers, including those planning to retire at the end of this year.

Sen. Jon Kyl (R-Ariz.), who will leave the Senate at the end of the 112th Congress, called the proposal “foolish.”

“Why should someone who has worked and accumulated some equity and is investing that in American businesses no longer be able to do that when they’re elected to public office?” he said Wednesday.

Leaders also denied a vote on an amendment sponsored by Sens. Michael Bennet (D-Colo.) and Jon Tester (D-Mo.) to permanently bar lawmakers from becoming lobbyists and restrict former staff from lobbying their old bosses in Congress for a period of six years.

Senators defeated another amendment sponsored by Paul to prohibit executive branch appointees and staff from having oversight, rule-making, and loan- or grant-making authority over companies in which they or their spouses have significant financial interest.

The amendment was designed to guard against the alleged improprieties stemming from the bankruptcy of Solyndra, a solar-panel manufacturer that received more than $500 million in federal loan guarantees.

A senior Senate Republican aide said GOP candidates would attack Democratic incumbents who voted against the so-called Solyndra amendment.

“Any Democrats who vote against this will face a bomb in the fall,” said the aide.

Brown, Tester and Sen. Joe Manchin (D-W.Va.) voted against the amendment.

The Senate also rejected a resolution sponsored by Sen. Jim DeMint (R-S.C.) calling for a constitutional amendment to impose term limits on members of Congress.

But the underlying proposal to ban lawmakers from using private information they learn in the course of their duties to profit from stock trades or other transactions received broad bipartisan support.

“We tried to focus at the specific task at hand, closing loopholes to ensure that members of Congress play by the exact same rules as everyone else,” said Sen. Kirsten Gillibrand (D-N.Y.), a sponsor of the legislation.

“This sorely-needed bill will establish for the first time a clear fiduciary responsibility to the people we serve, removing any doubt that the [Securities and Exchange Commission] and [Commodities Futures Trading Commission] are empowered to investigate and prosecute cases involving insider trading of non-public information that we have access to through our jobs,” she said.

Only three senators voted against final passage: Sens. Tom Coburn (R-Okla.), Richard Burr (R-N.C.) and Jeff Bingaman (D-N.M.).