More than half of the U.S. Senate may have a conflict of interest. That’s according to a new report by the investigative website Sludge, which examined the financial holdings of U.S. senators. The analysis found 51 senators and their spouses own stock in 338 companies, at a value of up to $96 million. The holdings included major companies like Apple, Microsoft, Alphabet (Google's parent company), ExxonMobil and Boeing, across sectors from energy to healthcare, communications, defense, finance, real estate and insurance.
It is legal for lawmakers to own stocks just like any other person, but doing so opens them up to at least the appearance of a conflict. "It does potentially undermine the legitimacy of decisions made by elected officials," says Mark Jones, political science professor at Rice University's Baker Institute. "They can invest in any company (legally), but as senators and lawmakers they have the ability to influence policies that affect the bottom lines of those companies."
Indeed, many of the senators who hold corporate stocks sit on committees that oversee the industries that include those companies. "Therefore, it does create an incentive for (lawmakers) to perhaps look out for what's in the best interest of the company, not what's in the best interest of the citizens of the United States," says Jones.
There are ways lawmakers can avoid the appearance of corruption short of divesting all of their stocks. "(Owning stocks) does create some ethical hurdles, and that's why some elected officials, when they're elected, effectively put their stock portfolio in a blind trust where they no longer have any influence over it," says Jones. "Where we do want to have extra concern is any significant purchase or sale of a stock where you could link their actions as a member of Congress with the performance of that company."