Stock Act passage stalled by amendments

Hoping for swift passage of rare bipartisan legislation, the Senate failed to reach a deal late Tuesday on an insider-trading bill, despite its broad support, when it was stalemated by legislators who insisted that unrelated amendments be included.

Along with reaffirming that the 1934 Securities Exchange Act applies to members of Congress, the Stock Act mandates that they report quickly on stock transactions they make. Leaders in both parties also said they want to extend the provisions to include the executive branch.

But the bill ran into a snag Tuesday as senators eager for the chance to attach amendments to what is now viewed as a must-pass bill, offered dozens of proposals ranging from earmarks to cracking down on lawmakers who leave Congress to become lobbyists.

The range of proposals frustrated Senate Majority Leader Harry Reid and a bipartisan group of lawmakers trying to move the bill forward.

“This becomes a circus; this is not the United States Senate that we have or should have,” Mr. Reid, Nevada Democrat, said. “If we continue the way we’re going, where people are saying you can’t have a vote on any amendment unless we have a vote on my nongermane amendment, what are we supposed to do? I won’t say it’s embarrassing, but it is a little bit.”

Sen. Joe Lieberman, Connecticut independent, condemned the pet projects that lawmakers loaded onto the legislation. He had hoped for easy passage after the Senate widely agreed 93-2 to advance the bill for debate late Monday.

But on Tuesday, senators proposed tacking on more than a dozen measures to ban bonuses for executives at Fannie Mae and Freddie Mac, make it easier for small businesses to raise capital, and require federal employees who become lobbyists to give up their government pensions, among other provisions - taking advantage of a decision by Mr. Reid to allow amendments to be added to the bill.

“At the end of a long day, we got nothing to show for our labor,” Mr. Lieberman said. “This requires some reasonableness from our colleagues to proceed.”

One amendment that would permanently ban earmarks, a joint project of Sens. Patrick J. Toomey, Pennsylvania Republican, and Claire McCaskill, Missouri Democrat, was strongly opposed Tuesday by Mr. Reid, who said he would not support such a measure.

“This legislation, I hope, is going to be an example of how we can work together to get things done,” Mr. Reid said. “I hope my Republican colleagues keep this in mind as we move forward.”

Called for by President Obama in his State of the Union address, the bill would specifically prohibit members of Congress from using nonpublic knowledge gained as legislators when buying and selling stocks or other publicly traded financial products.

While it’s disputed whether members of Congress engage in insider trading, CBS’ “60 Minutes” drew attention to the issue in November with a report accusing individual lawmakers of using their privileged knowledge for personal gain.

The Stock Act also calls for the comptroller general and the Congressional Research Service to prepare a report on the role of political intelligence in the financial markets.

Mr. Lieberman, sponsoring the bill along with Sens. Scott P. Brown, Massachusetts Republican, and Kirsten E. Gillibrand, New York Democrat, urged lawmakers to withdraw unrelated amendments and allow the bill to pass.

“I hope members who have introduced them will pull them back ultimately and let us consider them on another occasion so this bill is not killed with kindness,” Mr. Lieberman said. “Not smothered with too many amendments that stop us from doing the important things this bill does.”