Just days before the Senate was to vote on a bill benefiting the chip manufacturing industry, financial disclosures show that House Speaker Nancy Pelosi’s husband, Paul Pelosi, purchased up to $5 million of stock in a top semiconductor company.
This is not the first such occurrence. Over a year ago, as the House Judiciary Committee prepared to consider a bill curbing the influence of Big Tech, Mr. Pelosi exercised call options to purchase 4,000 shares of Alphabet, Google’s parent company. When it became evident that the legislation was going to be harmless to Google, he found himself $5 million richer.
If you ask Speaker Pelosi, this is all just a coincidence, not a violation of the 2012 STOCK Act, which prohibits members of Congress and their families from trading on insider information gleaned from the legislative process.
“The speaker does not own any stocks,” Pelosi’s spokesman told the Washington Examiner this week. “As you can see from the required disclosures, with which the Speaker fully cooperates, these transactions are marked ‘SP’ for Spouse. The Speaker has no prior knowledge or subsequent involvement in any transactions.”
But this is a completely insufficient explanation. Pelosi, the most powerful woman in the world, sets the agenda in the U.S. House. Her authority there is nearly absolute, and her influence on fellow legislators is overwhelming. Meanwhile, she lives with a man, at least when he isn’t away for other reasons, who has made more money just by making bets on stocks closely related to legislation than most American families make in 20 years of hard work. The two also live in a community-property state, so it is probably misleading to say that she is unaffected by what her husband owns.
So, is everyone expected to believe that the Pelosis never discuss her work? Does the speaker never breathe a word of satisfaction or displeasure at how certain matters are proceeding in the House that affect the value of key stocks?
The real question is why lawmakers and their families should ever behave in such a way as to make people wonder about their integrity. In the case of Hunter Biden, it is at least understandable that someone so utterly lacking in self-control should engage in corrupt financial arrangements. But what of Paul Pelosi? Is he breaking bad in his old age? Or is this an old habit of his that just went unnoticed until recently?
And what of all the other congressional spouses who bring suspicion upon themselves with such trades? Democrats are not especially bad in this regard. It is a bipartisan problem.
The truth is, people should never have to wonder whether their legislators are acting in the public interest or in their own personal interest, or whether their family members make good trading on their name.
The truth is, the current version of the STOCK Act is not nearly strict enough. The new version proposed this year would be a clear improvement. Public service is a choice. Those who choose to serve in Congress can and should be held to a more exacting standard than the general public when it comes to their personal investments.
As we have argued in this space for 11 years now, members of Congress have no need to be trading individual stocks. They can satisfy themselves with diversified investment vehicles that everyone else uses. Broad-based mutual funds are already the best and most popular choice for those preparing for retirement, at least if they lack insider information. As Pelosi put it last December, such funds would allow members of Congress to “participate” in the “free market economy.”
Pelosi and her husband are already astoundingly wealthy. But their behavior in this matter evinces a sense of entitlement that goes beyond any amount of wealth. She wants one set of rules for everyone else in the country — they are not allowed to trade on insider information even if they somehow obtain it — and another one for herself and her family. It is a very bad look.
