Editor’s note: Please read the update at the bottom.
In September, 2008, as the stock market was teetering and just about ready to plunge the country and the world into a Great Depression, Congressman Paul Ryan, according to reports, used insider information he received as a Congressman to sell stocks and avoid enormous financial losses. Ryan, who is now the Chairman of the House Budget Committee, “traded on insider information to avoid 2008 crash,” The Richmonder — which published Ryan’s financial disclosure form for 2008 – reports:
Ryan attended a closed meeting with congressional leaders, Bush’s Treasury Secretary Henry Paulson, and Federal Reserve Chairman Ben Bernanke on September 18, 2008. The purpose of the meeting was to disclose the coming economic meltdown and beg Congress to pass legislation to help collapsing banks. Instead of doing anything to help, Ryan left the meeting and on that very same day Paul Ryan sold shares of stock he owned in several troubled banks and reinvested the proceeds in Goldman Sachs, a bank that the meeting had disclosed was not in trouble.
Matt Yglesias at Salon says, “Let’s put this in the ‘the real scandal is what’s legal’ file,” writing:
This kind of trading might be illegal now, but was definitely kosher back then when insider trading rules didn’t apply to congress at all. My guess is that it’s probably fine even under today’s rules, since even though it fits the ordinary language meaning of “insider information” it doesn’t actually make Ryan an insider to the companies in question in a legal sense. But it’s about as clear an example of a public official trying to use his office to obtain personal benefits as you’re likely to find.
Congressman Paul Ryan, who is now Mitt Romney’s VP candidate, has seen his net worth increase “by up to 130 percent in a decade,” according to the Seattle Times:
Federal financial disclosure forms show that last year Ryan, 42, had assets of between $2.1 million and $7.8 million — figures that include a trust valued at between $1 million and $5 million inherited by his wife, Janna, after her mother died in 2010. A disclosure form said Ryan had assets of $479,000 to $1.6 million in 2001.
The disclosure forms do not require elected officials to give exact values of assets or income. Rather, they allow ranges, such as between $1 million and $5 million.
Excluding the inheritance, Ryan’s net worth increased by up to 130 percent in a decade marked by a deep recession and a volatile stock market.
UPDATE: 4:08 PM —
Matt Yglesias has walked back his statement, looking at the timeline of probably events. Whether or not Ryan traded stocks before or after his meeting with Bernanke, it’s reasonable to think he knew what the Bernanke closed door conversation was going to look like. Coincidence, or not?
Via Yglesias:
Let me apologize. I originally had a too-credulous item here linking to a piece at The Richmonder alleging that Paul Ryan has sold bank shares after a closed door meeting with Henry Paulson and Ben Bernanke on the financial crisis in 2008. As Eric Platt explains he certainly seems to have sold the shares on the same day as the meeting, but the meeting happened in the evening by which time the markets would have been closed. One can perhaps construct a scenario by which the Richmonder’s theory of the case holds up, but they don’t have the goods and I shouldn’t have passed their analysis on with no qualification and so little scrutiny of my own.
Related:
Romney: Paul Ryan Will Be My VP (Or, Everything You Wanted To Know But Were Afraid To Ask)