"This is a venture opportunity. This is an opportunity to leverage your position in public service and use that position to enrich yourself, your friends, and your family."
Those electric words opened last night's story on the CBS News program 60 Minutes about insider trading in Washington, D.C.
They were uttered by Peter Schweizer, a fellow at the Hoover Institution, which is a conservative think tank at Stanford University.
Schweizer was talking about members of the US Congress, who — according to Hoover and 60 Minutes — acquire "significant wealth beyond their salaries" in Washington, D.C., and who "prove particularly adept at buying and selling stocks."
Here's the problem, according to Schweizer, which was based on reporting that was independently confirmed by 60 Minutes:
Members of the US Congress are in possession of market-moving information, gleaned from their work in congressional committees. Yet they are not subject to the same insider trading rules that apply to everyone else, which are typically a criminal offense.
This sort of "honest graft," goes on all the time, Schweizer says.
According to 60 Minutes and Schweizer, US Congress members were trading health care stocks during the health care debate. They also profited from the global financial crisis.
"During the financial crisis of 2008 they were getting out of the market before the rest of America really knew what was going on," Schweizer said.
Here's the 60 Minutes report in its entirety:
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