Power and Profit: How Politicians Have Turned Stock Trading Into Legalized Insider Access
Power and profit shouldn’t need to be a topic in a democratic republic. Elected officials are supposed to serve the public, not profit from their positions. For decades, many politicians have blurred that line by using inside knowledge to enrich themselves through the stock market. What they call “investing” looks an awful lot like legalized insider trading and the numbers prove it.
What Is Insider Trading, Really?
Insider trading is when someone uses non-public, material information to buy or sell stocks for personal gain. In the private sector, it’s a federal crime. CEOs have gone to prison for it.
But if a senator or representative attends a closed-door briefing on an upcoming industry regulation, then trades stocks affected by it, that’s often totally legal under current law.
That’s where the conflict begins.
A Long History of Politicians Profiting From Power
The issue of politicians enriching themselves through insider knowledge isn’t new:
Past Example: Senator William Proxmire (1970s)
While Proxmire was known for being frugal, he exposed others in Congress who were profiting from defense spending decisions they helped make. He called out the growing pattern of lawmakers investing in companies they oversaw, even before insider trading was part of the public discussion.
Speaker Nancy Pelosi (2000s–2020s)
One of the most high-profile figures in this debate, Pelosi’s family has made millions in timely trades including call options on Google, Apple, Tesla, and Nvidia. Although she publicly defended the legality, public records show her net worth soared while in political power, reportedly from around $30 million in 2008 to over $120 million by 2021.
Senator Richard Burr (2020)
In early 2020, Burr attended classified briefings about COVID-19’s economic threat. Shortly after, he dumped hundreds of thousands in stocks before the market crashed. The FBI investigated him, but he was never charged. Is that because those with power to charge were guilty of the same thing, or knew they would have to charge others?
Senators Kelly Loeffler & David Perdue (2020)
Both Georgia senators made suspiciously timed trades following pandemic briefings. Loeffler dumped hotel and travel stocks and bought tech shares. Perdue invested in companies tied to defense contracts he helped approve.
Salaries vs. Wealth Gains: A Closer Look
| Politician | Salary (as of 2025) | Reported Net Worth When Elected | Net Worth Years Later |
|---|---|---|---|
| Nancy Pelosi | $223,500 (Speaker) | ~$30 million (2008) | ~$120+ million (2021) |
| Mitch McConnell | $193,400 (Minority Leader) | ~$3 million (2005) | ~$35+ million (2020) |
| Dianne Feinstein | $174,000 (Senator) | ~$26 million (1992) | ~$90 million (2020s) |
| Dan Crenshaw | $174,000 (Rep) | ~$800k (2019) | ~$2+ million (2023) |
While public service pays well, it doesn’t explain the exponential wealth growth, especially when it parallels suspiciously timed trades.
Do these people in power just feel they are entitled to the information and can use it to their advantage?
Why It’s a Massive Conflict of Interest
Politicians:
- Write laws that directly affect industries and companies
- Receive classified or early economic briefings
- Can delay public disclosure of their trades by up to 45 days (under the STOCK Act)
- Have no blind trust requirement, meaning they or their spouses can trade freely
In private business, this would be illegal. But in Congress, it’s merely “bad optics.”
There is even a page dedicated to their trades; Capitol Trades
The STOCK Act: A Toothless Reform?
Passed in 2012 after public pressure, the STOCK Act (Stop Trading on Congressional Knowledge) was meant to:
- Prohibit members of Congress from trading on insider info
- Require trade disclosures within 45 days
But in reality:
- There’s no enforcement mechanism
- Violators often face $200–$500 fines
- Loopholes allow spouses and family members to do the trading
In short: the STOCK Act exists, but it’s easy to dodge — and rarely punished.
Public Outrage Is Growing
- Over 75% of Americans (across party lines) believe members of Congress should be banned from trading individual stocks.
- Multiple bipartisan bills have been introduced to force Congress to use blind trusts, but most get blocked or quietly die in committee.
- Social media accounts like @unusual_whales and House Stock Watcher now track trades in real time, making it harder for politicians to hide.
Final Thoughts: Public Service, or Private Portfolio?
When lawmakers treat public office like a path to private wealth, trust in government erodes. Stock trading by politicians isn’t just shady, it’s a structural conflict of interest that undermines “civil service”.
Until laws are passed with real teeth; banning trading or forcing blind trusts, politicians will continue to operate with a level of access and immunity no private citizen could dream of.
With all that in mind, the topic next week is why we need term limits now, more than ever.