Eric Cantor protects political intelligence consultants from STOCK Act

Eric Cantor under fire for STOCK Act tweaks
Cantor's version strips a provision requiring consultants to disclose their activities.
By SEUNG MIN KIM
2/8/12
Politico

A feel-good bill has suddenly turned nasty.

House Majority Leader Eric Cantor (R-Va.) has released his version of a congressional insider-trading ban, and it strips a provision that would require so-called political intelligence consultants to disclose their activities, like lobbyists already do. It also scraps a proposal that empowers federal prosecutors going after corruption by public officials.
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That’s stoked backlash from Democrats and even some Republicans, who are furious at Cantor and are accusing the Virginia Republican of watering down the popular legislation that easily passed Senate last week.

Sen. Chuck Grassley (R-Iowa) slammed the House for deleting his amendment targeting the political intelligence industry, which tracks action on Capitol Hill and then sells the information to investors. Instead, the House bill requires just a study of the industry’s activities within 12 months.

“It’s astonishing and extremely disappointing that the House would fulfill Wall Street’s wishes by killing this provision,” Grassley said in a statement. “If Congress delays action, the political intelligence industry will stay in the shadows, just the way Wall Street likes it.”

Cantor spokeswoman Laena Fallon said the provision was deleted because it was “extremely broad” and added that the “unintended consequences on the provision could have affected the first amendment rights of everyone participating in local rotaries to national media conglomerates.”

Democrats weren’t comforted by that explanation.

“The thing we greatly feared has come upon us,” Rep. Louise Slaughter (D-N.Y.) told reporters on Wednesday. “It has been weakened, totally, as far as I’m concerned.”

Sen. Patrick Leahy (D-Vt.), who co-authored with Sen. John Cornyn (R-Texas) an amendment to crack down on public corruption using a number of measures, said he was “deeply disappointed” his provision had disappeared from the House bill. Leahy noted that a similar measure cleared the House Judiciary Committee in December.

“If we are serious about restoring faith in government and addressing the kinds of egregious misconduct that we have witnessed in recent years in high-profile public corruption cases, Congress must act now to enact serious anti-corruption legislation,” Leahy said in a statement. “The House Republicans’ version of the STOCK Act misses that opportunity.”

For Cantor’s part, the House’s No. 2 Republican has added provisions that he says strengthens the STOCK Act, which explicitly bars lawmakers and their aides from using nonpublic information gained through their jobs to profit themselves.

The new version of the House’s STOCK Act ensures that the bill’s insider-trading ban and its disclosure requirements apply to the executive branch, and it also bans lawmakers convicted of a crime from collecting pensions.

In a shot at House Minority Leader Nancy Pelosi, Republicans also added a so-called “Pelosi provision” that imposes stricter rules on public officials who participate in initial public offerings. The California Democrat was targeted in a “60 Minutes” probe that reported Pelosi and her husband participated in Visa’s IPO while a bill governing credit-card legislation was pending before Congress.

Pelosi has denied any conflict of interest or special access related to the Visa IPO.

Slaughter was peeved at the “Pelosi Provision” when asked about it on Wednesday.

“I think the fact that they put this in was strictly to cause grief to [Pelosi],” Slaughter said, “and I resent it.”

Cantor said in a statement late Tuesday that he consulted “dozens of members” as he reworked the bill. But neither Slaughter nor Rep. Tim Walz (D-Minn.), the primary sponsors of the STOCK Act, worked with Cantor on the new bill, the Democrats said.

Despite the partisan bickering, the legislation is expected to pass when it comes up for a vote Thursday.