Former Alaska governor and GOP vice-presidential candidate Sarah Palin blasted rampant corruption in the marbled halls of Congress Friday, calling it an “endemic problem” affecting both parties.
“The only solution to entrenched corruption is sudden and relentless reform,” she wrote.
Palin’s remarks came in an op-ed column in The Wall Street Journal, in response to revelations this week that Congress has exempted itself from the prohibitions against insider trading that all other Americans are subject to.
Under current law, members of Congress are free to profit off of equity swings tied to pending legislative actions decisions they are privy to as members of Congress.
The Center for Responsive Politics has determined that 47 percent of all members of Congress are millionaires. This compares to about 1 percent of the population generally.
“How do politicians who arrive in Washington, D.C. as men and women of modest means leave as millionaires?” Palin asks in her column. “How do they miraculously accumulate wealth at a rate faster than the rest of us? How do politicians’ stock portfolios outperform even the best hedge fund managers?”
Palin’s answer: “Politicians derive power from the authority of their office and their access to our tax dollars, and they use that power to enrich and shield themselves.”
Special exemptions that Congress has written for itself to insider trading and other laws have come under intense scrutiny this week, in part due to the illuminating new book by Hoover fellow Peter Schweizer titled: “Throw Them All Out.”
“The very idea that politicians trade stocks while they are considering major bills comes as a shock to many people, but it is standard practice in Washington,” Schweizer writes in the book. As to Palin’s WSJ column, he tells Newsmax: “Governor Palin understands how Washington works and the battle that needs to be fought.”
A CBS 60 Minutes expose on Sunday highlighted trades made by former House Speaker Nancy Pelosi and by Spencer Bachus, R-Ala., chairman of the House Financial Services committee.
Schweizer said Bachus received private briefings in 2008 from the Treasury Secretary and the Chairman of the Federal Reserve warning that the financial system was about to implode. He then made a series of investments that would generate profits as the market tanked. Bachus disputes Schweizer’s allegations, however.
Pelosi, a Democrat from San Francisco, also has denied making any inappropriate investments. Sources say Pelosi and husband Paul, an investor, bought stock in Visa when the House was considering a bill that would limit credit card companies’ ability to levy fees on consumers — a significant source of their revenues. In response, Pelosi has touted her record as a champion of pro-consumer reforms.
Among the “money-making opportunities” for members of Congress Palin exposes in her column:
Insider Trading – using government information not available to the public at large to predict which companies’ stocks will rise or fall.
IPO Gifts – While it is illegal for members of Congress to accept cash gifts from interested parties, there is no restriction on their being offered initial public offerings in firms, which can be very profitable.
Self-Serving Earmarks – Some members of Congress have submitted infrastructure earmark requests for their districts that appeared to increase their value of their real estate holdings.
Encouraging Campaign Donations – Palin calls this “subtly extorting campaign donations through the threat of legislation unfavorable to an industry.”
Palin wrote that the revelations don’t surprise her, owing to her experience fighting cronyism as governor of Alaska. She said that Congress has largely exempted itself from compliance with the Freedom of Information Act used to obtain public documents. Also, unlike other government officials, members of Congress can punish staff members who expose abuses with impunity, because they aren’t subject to whistleblower laws, she said.
Palin called for “real transparency.”
“From now on, laws that apply to the private sector must apply to Congress, including whistleblower, conflict-of-interest, and insider trading laws,” wrote Palin. “Trading on nonpublic government information should be illegal both for those who pass on the information and those who trade on it.”
On Tuesday, GOP Sen. Scott Brown of Massachusetts filed a bill to make it illegal for members of Congress or their staffs to disclose information or make investments related to pending legislation based on nonpublic government knowledge.