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Minor Senate bill transformed into broad reform package
By Paul Kane, Thursday, February 2, 10:17 AM

In a sign of just how unpopular Congress has become, rank-and-file
senators hijacked debate over a narrowly tailored ethics bill and won
broad approval Thursday of a more sweeping reform package imposing new
conflict-of-interest rules and mandating more transparency on K
Street.

From conservative back-bench Republicans to liberal junior Democrats,
senators launched an ethical arms race of amendments by offering far-
reaching reforms that were not even considered when Congress last
rewrote its ethics rules five years ago.

 Recent polls show Congress’s approval near an all-time low. You’d be
surprised at some of the things in history that have been more popular
than the current Congress.
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“This is mass repentance for past sins,” Sen. Joseph I. Lieberman (I-
Conn.), who managed the floor debate, said half-jokingly as he left
the Capitol on Wednesday night.

Senate leaders, who had hoped to quickly approve a modest provision
formally outlawing equity insider trading by lawmakers and staff,
instead navigated a mine field of reform offerings that went far
beyond the relatively simplistic underlying legislation. Rather than
just forbidding lawmakers and staff from trading on private
information they learned from their positions, the legislation
extended restrictions into the executive branch and Washington’s
consulting class on a 96 to 3 vote.

During an afternoon of rapid-fire votes Thursday, the Senate extended
the insider-trading restrictions to senior members of the executive
branch. The legislation now requires lawmakers and senior executive
branch officials, for the first time, to reveal all mortgage
information on their primary residence. On a unanimous voice vote, the
Senate approved a prohibition on bonuses to senior executives at
Fannie Mae and Freddie Mac, following reports that the two mortgage
giants had approved nearly $13 million in bonuses to 10 executives.

In addition, members of the so-called political intelligence industry
— insiders who try to learn in advance the outcome of legislation for
hedge fund and investment house clients, who then place their stock
bets based on that information — would now be required to disclose
their activities just as lobbyists trying to influence the outcome
must.

The House, which has a more narrowly crafted insider trading bill,
expects to consider its version of the legislation later this month.

But while the more expansive legislation passed, Senate Majority
Leader Harry M. Reid (D-Nev.) and Minority Leader Mitch McConnell (R-
Ky.) sidestepped some of the most far-reaching reforms ever offered in
Congress.

Freshman Sen. Rand Paul (R-Ky.) proposed that former congressmen
forfeit their federal pension and insurance plans if they become
lobbyists after retiring from Capitol Hill. Not to be outdone, Sen.
Michael Bennet (D-Colo.) offered an amendment that would impose a
lifetime ban on lawmakers ever becoming federal lobbyists. Former
staff, currently facing a one-year ban from lobbying their former
congressional bosses would have faced a six-year ban.

Those provisions were among the proposals that Reid and McConnell
agreed to privately scuttle without holding a vote. Another offering —
a proposal to permanently ban earmarks, those line items that
lawmakers insert into legislation to benefit individual projects — won
just 40 votes as the majority decided that the current moratorium of
the controversial projects was sufficient.