Why does insider trading bother people so much that Congress has come up with a “solution” that will cost $1.7 million? (‘Stock Act’ sticks taxpayers with $1.7 million tab)
Politicians are people too
People hate insider trading because it reveals that politicians, when given the opportunity, make decisions that benefit them. They aren’t superhumans born without a self-improvement gene, or people who’ve learned how to overcome it. Cronies, they’re just like us!
The danger of self-interest in politics is clear. To mitigate this danger, there are two choices.
Make all the things illegal
Your first option is to try to take the benefits of the choices away from the politicians and bureaucrats. Find every way a politician or bureaucrat could possibly personally benefit from their legislation and make it illegal. Privately funded campaigns, stock market choices, dinners paid for by lobbyists, private schooling for their kids, consulting jobs after they leave office, all that has to go. Then tackle the million perks of which we could have never thought.
Strike at the root
The other option is to take the power to legislate away from the politicians and bureaucrats. Limited government means lobbyists can take congressmen and women out to dinner every night of the week. But it’ll be for nothing, because they won’t have the power to make choices that screw us over and benefit them.
Take the Pelosi VISA scandal for example. Nancy Pelosi voted for a bill that screwed consumers and enriched her VISA-stock-owning husband.
First of all, the problem is the bill. The bill is the end result that we’re trying to avoid: legislation that screws consumers.
Now you can go around spending billions of dollars trying to find out which stocks every family member of friend of a congressperson or bureaucrat owns. Or you can take the power to regulate private enterprise away from congress and leave it to the market.
One will be extraordinarily expensive and totally ineffective. Rent seeking and collusion will continue to wreak ruinous legislation on the masses.
The other will unleash the power of the competitive marketplace. When businesses can no longer effectively lobby government for competitive advantages, they’ll actually have to innovate.
Unless I’m missing something here, the choice seems pretty clear.