A new bill being introduced by Sens. Kirsten Gillibrand (D-N.Y.) and Josh Hawley (R-Mo.) would bar executive branch officials, members of Congress and their families from owning or trading stocks in individual companies.
Efforts to curb or ban stock trading by members of Congress have gained momentum in the past few years, with a slew of bills on the topic, as well as major investigations by the New York Times and Wall Street Journal.
Letting members play the stock market creates conflicts of interest that are an invitation to corruption. This is particularly troubling when these deals involve members who have decision making power over spending on the Pentagon, intelligence, and homeland security. America’s security should not be for sale.
Support for higher Pentagon budgets can lift share values of members invested in weapons industry stocks. These votes for Pentagon increases may be based on other considerations, but the key point is that stock trading creates the opportunity for self-dealing and profiteering on the part of key members of Congress. The temptation for corrupt decision making is itself a serious problem. Even the appearance of conflicts of interest undercuts public trust in the budget decision making process.
Investigations by major news outlets and non-governmental organizations have identified at least 25 members of key national security committees with investments in arms industry stocks, in firms ranging from top-ranked contractors like Lockheed Martin and Raytheon to lesser known companies like Huntington Ingalls Industries and L3 Harris.
Examples include Sen. Tommy Tuberville (R-Ala.), a member of the Senate Armed Services Committee, and a prolific stock trader. Tuberville is best known for putting a hold on top military nominations to protest the Pentagon policy that covers abortion-related travel expenses for service members based in states with restrictive reproductive healthcare laws. The Pentagon estimates that Tuberville’s actions could impact 650 positions by the end of this year.
Meanwhile, Tuberville reported owning hundreds of thousands of shares in Honeywell, Lockheed Martin, General Electric, Raytheon, and General Dynamics since 2020. Additionally, he sold his shares of Microsoft about two weeks before it became public that the company’s $10 billion contract with the Pentagon was canceled. He also bet against a Taiwanese company whose stock is often affected by U.S.-China relations, as RS’s Connor Echols reported earlier this year.
Another SASC member, Sen. Jacky Rosen (D-Nev.) reported co-owning $110,000 worth of shares in General Electric with her husband. Rep. John Rutherford (R-Fla.) bought shares in Raytheon on February 24, 2022 — the day Russia invaded Ukraine. Rutherford sits on the House Appropriations homeland security subcommittee. Rep. Josh Gottheimer (D-N.J.), who sits on the House Permanent Select Committee on Intelligence (and is the ranking member of the National Security Agency and Cyber subcommittee) has traded millions in Microsoft shares — the latest example being his purchase of three $1-5 million blocs of shares on May 15 and 16 this year.
There are a number of cases in which members have failed to comply even with the weak rules that are now on the books, which involve periodic reporting on stock deals.
As the Project on Government Oversight has pointed out, the best way to eliminate the potential conflicts of interest inherent in congressional stock ownership is to institute a comprehensive ban on trading in stocks by all members of Congress as well as immediate family members and senior staff — with no loopholes, and no complex work arounds. POGO elaborated on the features of a strong stock trading ban in congressional testimony last year. Many recent legislative proposals fall short of this standard.
Stock trading is just one potential financial incentive for members of armed services, defense appropriations, intelligence, and homeland security committees to jack up military spending. Campaign contributions, arms-related jobs in a member’s state or district, and lobbying by former colleagues also exert pressure to up the Pentagon’s already enormous budget.
For example, Rep. Mike Rogers (R-Ala.), chairman of the House Armed Services Committee, was the top recipient of defense industry campaign contributions during the 2022 midterm election cycle, getting over $511,000 in donations from weapons makers. The aforementioned Sen. Tuberville has received over $244,000 in arms industry contributions since 2017.
Meanwhile, in the past two years — prior to this year’s debt ceiling deal — Congress added $25 billion and $45 billion to the Pentagon budget, respectively, beyond what the department even asked for. Much of this funding was for projects in the districts or states of key members. And in many cases the member in question even issued a press release bragging about the items they added to the budget. These statements are almost always accompanied by a perfunctory argument that the additional spending is necessary for national security, but in many cases these protestations are just a smoke screen to hide the fact that these decisions serve special interests, not the national interest.
Adding unnecessary weapons to the budget for economic and political reasons is a form of legalized corruption that wastes scarce taxpayer dollars and undermines the possibility of aligning arms spending with a more sound defense posture.
Stock trading is just one piece of a larger problem of undue pressures on Congress to “go big” on Pentagon spending. But eliminating it would be a step in the right direction that might encourage initiatives to reform other practices that stand in the way of crafting a more realistic Pentagon budget in service of a more coherent defense strategy.
MUNICH, GERMANY – The Munich Security Conference came to an end today but not before EU leaders warned that international “winds” might be blowing against the West on the issue of Israel’s war in Gaza
While the international meeting this weekend entertained manifold topics — from the role of the Global South to the importance of AI and food security — the Ukraine war dominated the conference, with Gaza coming in second at a considerable distance.
But the focus on Israel’s military operations grew more intense as the confab drew to a close, between yesterday afternoon and Sunday morning. In the press center, for example, the current situation in Gaza vied for attention with the death of Russian opposition figure Alexei Navalny and Ukrainian President Volodymyr Zelensky’s speech on Saturday.
Indeed, Rafah was an often-repeated word Sunday in the Bavarian capital. The day before in a televised news conference, Israeli Prime Minister Benjamin Netanyahu announced that “total victory” against Hamas would require an offensive against Rafah once people living there evacuate to safe areas. It is difficult to see how the concept of a “safe area” can apply to any place in the Gaza Strip today. At least 28,985 people have been killed and 68,883 injured (mostly civilians) in the Gaza Strip since October 7, when 1,200 Israelis were killed and over 250 hostages taken during a Hamas attack against Israel. In a side event Sunday organized by the Consulate General of Israel in Munich, the press was shown a video, about 10 minutes long, documenting Hamas atrocities on October 7.
According to the United Nations, over 75% of the Gazan population has been displaced, many multiple times. There is also a severe lack of food, medicine, and other essential items because of Israel’s decision to let only a trickle of the aid trucks into Gaza needed to maintain basic conditions of life.
Addressing the audience in Munich, EU foreign policy chief Josep Borrell stated that peace in the Middle East requires “a prospect for the Palestinian people” and that “the security of Israel will not be ensured just by military means.”
In a reference to the war in Gaza, he noted that “Russia is taking good advantage of our mistakes. The blame about double standards is something that we need to address and not only with nice words. It is clear that the wind is blowing against the West.”
Borrell appears to share a worry openly expressed by some of the European leaders — such as Spanish president Pedro Sánchez and Irish prime minister Leo Varadkar — who have been even more critical of Israel. The concern is that Europe’s failure to rein in Israel will undermine global support for Ukraine and discredit the European discourse on the importance of international law.
Borrell, in sharp contrast with European Commission President Ursula von der Leyen, has represented the most vocal position within the EU on the growing death toll and humanitarian catastrophe in Gaza after October 7. Earlier this week, the EU top diplomat replied to Biden’s recent description of Israel’s military conduct in Gaza as being “over the top.” Borrell noted that "if you believe that too many people are being killed, maybe you should provide less arms in order to prevent so many people being killed."
Borrell has long supported a ceasefire but any EU decision on the matter requires unanimity, and countries like Germany, Austria, and Hungary are not on board.
American ambassador to the United Nations Linda Thomas-Greenfield said yesterday that the U.S. will veto an Algerian proposal for a ceasefire in Gaza to be taken up at the UN Security Council on Tuesday. According to Thomas-Greenfield, the U.S. is working hard for “a sustainable resolution of the Gaza conflict,” and the Algerian resolution would endanger this.
In an oft-repeated dynamic over the last months, the U.S. is basically asking the international community to trust that Washington’s diplomatic pressure will force Netanyahu to change course. Such an approach has failed once and again, and there is no clear reason to believe this time will be different.
Yesterday afternoon, Qatar’s Prime Minister Sheikh Mohammed bin Abdulrahman Al Thani noted that the efforts to reach an agreement between Israel and Hamas have been dominated by a pattern that “is not really very promising.”
Part of the U.S. approach to the current conflict has also been to demand that the Palestinian Authority (PA) reforms itself. Washington hopes the PA can govern the Gaza Strip after the war ends, but Netanyahu has been adamant it does not envisage any role for the PA in the Gaza Strip in the future.
The Palestinian Prime Minister Mohammad Shtayyeh was in Munich on Sunday, remarking in an interview that the PA — which has grown even more unpopular in the West Bank after October 7 — is already working on introducing reforms. Shtayyeh said that the recent insistence on the topic only seeks to divert attention from the Israeli military operation in Gaza, however.
In his view, Netanyahu’s interest today is “to keep the war going” and argued that “Netanyahu’s war is going to continue until the end of the year.” The Palestinian leader was supposed to be present at a press briefing around midday, but the event was canceled on short notice due to “scheduling reasons.”
In a panel with his Spanish and Canadian counterparts, Jordanian Foreign Minister Ayman Safadi was one of the last Arab leaders to speak in Munich. He used the opportunity to note that “Israel cannot have security unless Palestinians have security.”
This afternoon, the Munich city center was returning to its normal state after an intense weekend of both open and closed-door meetings featuring top leaders from Europe and beyond. As security barriers were being removed and the 5,000 police officers deployed for the event, many of them from other parts of Germany, returned home, it wasn’t hard to note that beyond all the talk, the world’s thorniest problems, including two major conflicts, are left unresolved.
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Volodymyr Zelensky speaks at the Munich Security Conference, Feb. 17, 2024. (David Hecker/MSC)
MUNICH, GERMANY — If U.S. Vice President Kamala Harris dominated the first day of the Munich Security Conference with her remarks, today it was German Chancellor Olaf Scholz’s and Ukrainian President Volodymyr Zelensky’s turn.
It was not only Zelensky who understandably devoted his whole speech to the Ukraine War but also Scholz, too. The German Chancellor, while boasting that his country will devote 2% of its GDP to defense expenditures this year, remarked that “we Europeans need to do much more for our security now and in the future.”
In a brief but clear reference to Trump’s recent statements on NATO, Scholz said, "any relativization of NATO’s mutual defense guarantee will only benefit those who, just like Putin, want to weaken us.” On the guns and butter debate, which is particularly relevant in Germany due to negligible economic growth, Scholz acknowledged that critical voices are saying, “should not we be using the money for other things?” But he chose not to engage in this debate, noting instead that “Moscow is fanning the flames of such doubts with targeted disinformation campaigns and with propaganda on social media.”
The Russian capture of the city represents the most significant defeat for Ukraine since the failure of its counter-offensive last year. On the loss of Avdiivka, Zelensky said that Ukraine had lost one soldier for every seven soldiers who have died on the Russian side. This, however, is difficult to reconcile with the reports about the rushed Ukrainian retreat, with a Ukrainian soldier explaining that “the road to Avdiivka is littered with our corpses.”
Throughout his speech, Zelensky repeatedly referred to the importance of defending what he called the “rules-based world order” by defeating Russia. If there was one take-away that Zelensky wanted impressed on this audience: “Please do not ask Ukraine when the war will end. Ask yourself why is Putin still able to continue it.”
He also seemed to suggest that it was not a lack of available weapons and artillery but a willingness to give them over to Ukraine. “Dear friends, unfortunately keeping Ukraine in the artificial deficit of weapons, particularly in deficit of artillery and long-range capabilities, allows Putin to adapt to the current intensity of the war,” Zelenskyy said. “The self-weakening of democracy over time undermines our joint results.”
The future of NATO was one of the main topics of the day. European leaders were in agreement that Europe needs to spend more on defense, and occasionally appeared to compete with each other on who has spent the most on weapons delivered to Ukraine or in their national defense budgets.
With NATO Secretary General Jens Stoltenberg in attendance, one of the panels featured two of the most talked-about names to replace the Norwegian politician in the 75th-anniversary summit in Washington in July: EU Commission President Ursula von der Leyen and caretaker Dutch Prime Minister Mark Rutte. According to a report by the German newspaper Welt am Sonntag, President Joseph Biden and his Secretary of State Anthony Blinken favor the German leader, but in Paris, London, and Berlin, the Dutch politician is preferred.
The participation of the Netherlands in the initial U.S.-UK joint strikes against Houthi positions in Yemen on Jan. 11 was read in some quarters as a sign of Rutte’s ambitions. The Netherlands was the only EU country to join these initial attacks.
A G7 meeting of foreign ministers also took place Saturday on the sidelines of the conference. In a press briefing that followed, Italian Foreign Minister Antonio Tajani — who currently presides the G7 — reiterated the group’s support for Ukraine. The current situation in the Red Sea, as is often the case in the West, was presented by Tajani as a topic divorced from the Gaza Strip. The Houthis started their campaign against ships in the Red Sea after the beginning of the war in Gaza, claiming they want to force an end to the conflict.
There is no certainty that the end of the war in Gaza would put an end to Houthi attacks, but presenting the situation in the Red Sea as being nothing but a threat to freedom of trade is considered by experts to be a a myopic approach.
Nevertheless, Italy will be in command of the new EU naval mission ASPIDES, to be deployed soon in the Red Sea. The mission is expected to be approved by the next meeting of EU foreign affairs ministers on Monday. When asked whether he could ensure that ASPIDES would remain a defensive mission, the Italian Foreign Minister said ASPIDES aims at defending merchant ships and that if drones or missiles are launched, they will be shot down, but no attacks will be conducted.
Marc Martorell Junyent is in Munich, covering the conference for Responsible Statecraft this weekend. This story is developing and is being updated.
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Vice President Kamala Harris at the Munich Security Conference, Feb. 16, 2024. (Lukas Barth-Tuttas/MSC)
MUNICH, GERMANY – The 60th year of the Munich Security Conference opened today with much of the early energy surrounding remarks by Vice President Kamala Harris.
The vice president noted that it was nearly two years since the beginning of Russia’s invasion of Ukraine on Feb. 24, 2022. She said that when Putin unleashed his troops along different fronts in February 2022, “many thought Kyiv would fall within a day.” It is also true, as she pointed out, that “Ukraine has regained more than half the territory Russia occupied at the start of the conflict.” (Russia held about 7% before the invasion, 27% right after, and about 18% today.)
However, by choosing the first months of the war as the starting point of her speech, Harris sought to avoid the obvious. Namely, that in the year that has gone by since her last visit to Munich, the Ukrainian army has been losing ground. Yet, her remarks regarding Ukraine today did not differ much from her speech in 2023.
Harris seemed dedicated to keeping to the administration’s recent script, which is warning against heralding in a new era of “isolationism,” referring to President Biden's likely presidential election opponent, Donald Trump.
As president Biden and I have made clear over the past three years, we are committed to pursue global engagement, to uphold international rules and norms, to defend democratic values at home and abroad, and to work with our allies and partners in pursuit of shared goals.
As I travel throughout my country and the world, it is clear to me: this approach makes America strong. And it keeps Americans safe.
Interestingly, the U.S. has been accused of thwarting "international rules and norms" in its unconditional support of Israel’s war on Gaza, which has killed upwards of 29,000 Palestinians, mostly of them civilians, since Hamas’s Oct. 7 invasion of Israel and hostage-taking. Christoph Heusgen, the chairman of the Munich Security Conference, asked Harris whether a two-state solution for Israel and Palestine was achievable. Harris answered that “the short answer is yes… but we must then put the discussion in context, starting with October 7.” Not 1948, not 1967, but October 7, 2023.
Her prepared remarks on the situation were very brief, overall, saying:
In the Middle East, we are working to end the conflict that Hamas triggered on October 7th as soon as possible and ensure it ends in a way where Israel is secure, hostages are released, the humanitarian crisis is resolved, Hamas does not control Gaza, and Palestinians can enjoy their right to security, dignity, freedom, and self-determination.
This work — while we also work to counter aggression from Iran and its proxies, prevent regional escalation, and promote regional integration.
October 7 was the topic of a conference side event hosted by Brigadier-General Gal Hirsch, Israel’s Coordinator for Hostages and Missing. In his opening speech, he called for a Global War on Kidnapping inspired by George Bush’s War on Terror. Hirsch was short on the specifics, and Israeli foreign minister Israel Katz did not develop the concept further when he followed Hirsch at the podium. During the event, several hostages released during the short ceasefire between Israel and Hamas in November 2023 described their harrowing experiences in captivity. Relatives of the remaining hostages accompanied them.
Meanwhile, in a morning event, German Finance Minister Christian Lindner and Greek Prime Minister Kyriakos Mitsotakis discussed how to increase defense spending in a time of economic stagnation. Mitsotakis, whose country has always spent significantly more than the expected 2% of the GDP required by NATO, stated that defense policy cannot be done on a budget. Lindner, meanwhile, remarked that Germany is on the way to spending 2% of its GDP on defense. Economic prosperity, the German Liberal minister noted, should avoid tradeoffs between social and defense policies. This is certainly a difficult equation to square since the German government just announced it was reviewing its forecast for GDP growth in 2024 from 1.3% down to 0.2%.
Marc Martorell Junyent is in Munich, covering the conference for Responsible Statecraft this weekend. This story is developing.