House Speaker Nancy Pelosi is curiously gifted at making money in the stock market. Now a new law could help her, and other lawmakers keep more of what they’ve made.
Pelosi could benefit from legislation that would save lawmakers millions of dollars in capital gains taxes, Newsmax reported. Ironically, it would come courtesy of the Ban on Congressional Stock Ownership Act meant to limit opportunities for those in power to make money in the stock market.
Sens. Elizabeth Warren (D-MA) and Steve Daines (R-MT) proposed the bipartisan legislation designed to prevent lawmakers from trading stocks and force them to put existing shares into blind trusts, the New York Post reported. Individual stocks would have to be sold off, but therein lies the chance to make a killing for Pelosi and her ilk.
Instead of selling these assets and paying capital gains taxes, lawmakers would be able to turn them over into investment funds or U.S. Treasury bonds. The capital gains taxes would be deferred until those new instruments were sold — and if the lawmakers die beforehand, the taxes are eliminated completely.
Though Pelosi has offered no official approval for this provision in the bill, she has expressed enthusiasm for this break for the legislative branch. “As you know, in the executive branch, when they divest of their stock, they don’t pay capital gains,” Pelosi said in a news conference last week. “So that’s an interesting feature.”
This scheme has not escaped the notice of experts like Columbia Business School professor and tax analyst Robert Willens. “It’s an absolutely reasonable thing to consider whether the advantages of tax deferral — if not permanent tax elimination if you die with the property — outweigh the disadvantages,” he said.
“This, in essence, confines them to very safe and placid investments while also looking like they’re occupying the moral high ground.” He further admitted that it would amount to Congress getting “interest-free loans from the government” to purchase new investments.
Pelosi and her family have made a killing on the stock market despite the obvious conflict of being in a position to impact the economic climate in her favor. Now it looks like she’s ready to cash in even more on this provision — and all while trying to appear virtuous.