Democrats demand probe into stock trading of Trump’s HHS nominee; GOP’s righteous indignation misplaced, puzzling

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Senate Democrats on Thursday (January 5, 2016) demanded an ethics probe into Tom Price, President-elect Donald Trump’s pick for US health secretary, following a report that the fierce Obamacare critic traded in healthcare company stocks while pushing legislation in Congress that could affect those shares.

Senate Dems demand ethics probe into @RepTomPrice, @RealDonaldTrump pick for @HHSgov Sec Click To Tweet

Senate Democratic leader Chuck Schumer and others made their comments as congressional Republicans moved ahead with their long-desired effort to dismantle President Barack Obama’s Affordable Care Act, says Reuters. Nonetheless, it was a week which signaled the ferocity and vehemence with which Democrats will fight to protect the 2010 law.

Price is an orthopedic surgeon and a Republican congressman from Georgia who, if confirmed by the Senate as Department of Health and Human Services (HHS) secretary, would be given the task of carrying out Trump’s promise to gut the law that has enabled up to 20 million previously uninsured Americans to obtain medical coverage.

The Democrats called on the independent Office of Congressional Ethics (OCE), which examines misconduct allegations involving House of Representatives members, to investigate Price’s stock trades.

The Wall Street Journal last month reported that Price bought and sold more than $300,000 in stock in about 40 healthcare, pharmaceutical and biomedical companies over the past four years while sponsoring and advocating legislation that could influence those companies’ shares.

“Every American should be shocked by this,” Schumer told a news conference. “We don’t know if he broke the law,” Schumer said of Price. “But there are certainly enough serious questions to warrant a serious investigation before any hearing is held on Congressman Price to become secretary of HHS.”

Democratic Senator Patty Murray from Washington said lawmakers want to know what nonpublic information Price may have had when the transactions at issue were made.

Phil Blando, a Trump transition spokesman, called Schumer’s demands a “stunt” to deflect attention from Obamacare’s “dismal record.” Price, asked by Reuters in a Capitol hallway for a reaction to Schumer’s comments, replied, “We’re looking forward to a positive and productive confirmation hearing.”

A 2012 law prohibits members and employees of Congress from using “any nonpublic information” stemming from the person’s position or gained while performing their job for personal benefit.

The nonpartisan watchdog group Public Citizen also asked the ethics office, as well as the US Securities and Exchange Commission, to investigate Price and another Republican congressman, Chris Collins of New York, for possible violations of insider trading and conflict-of-interest laws and rules.

Public Citizen said that, while serving in the House, Collins also sat on the board of directors of Australian biotech company Innate Immunotherapeutics Ltd. and was its largest shareholder, with a 17% stake. It said Price also bought shares in the company.

Collins serves as the Trump transition team’s congressional liaison. Collins spokesman Michael McAdams said in a statement the congressman:

“has followed all ethical guidelines related to his personal finances during his time in the House and will continue to do so.”

House Republicans had moved last Monday to weaken the ethics office but backtracked a day later after criticism from Democrats and Trump. Transition spokesman Blando said the ethics questions Schumer raised about Price should be directed to three sitting Democratic senators, Delaware’s Tom Carper, Virginia’s Mark Warner and Rhode Island’s Sheldon Whitehouse,

“who own and have traded hundreds of thousands of dollars in pharmaceutical and health insurance company stocks.” Blando added, “Hypocrisy is apparently alive and well this morning in Washington.”

Steve’s Take:

So top Democrats in the US Senate on Thursday called on the Office of Congressional Ethics (OCE) to investigate Rep. Tom Price–Trump’s pick to head the Department of Health and Human Services–before the start of confirmation proceedings. But why the immediate sound and fury from the GOP, as though the Dems were on a witch hunt with Dr. Price?

Senate Minority Leader Chuck Schumer told reporters at a Capitol Hill press conference that “every American should be shocked” after the Wall Street Journal reported that over the past four years, Price traded more than $300,000 in medical stocks “while sponsoring and advocating legislation” that could affect those stocks. Sounds like something that the Dems owe it to their constituents to take a second look at.

“We don’t know if he broke the law, but there is certainly enough serious questions to warrant a serious investigation before a hearing is held on Congressman Price to become secretary of HHS,” Schumer said.

It’s called “just cause,” and Schumer’s right. I was taught the term refers to a standard of reasonableness used to evaluate a person’s actions in a given set of circumstances.

In other words, it’s a reasonable and lawful ground for action, in this case, an investigation as part of the normal proceedings leading to a confirmation hearing. Price traded healthcare stocks while an elected official serving on healthcare-related congressional committees. Isn’t that enough for an inquiry about the propriety of that?

Two committees–Senate Health, Education, Labor & Pensions (HELP) and Finance–share jurisdiction over Price’s nomination, though only Finance will vote on sending Price’s name to the floor for confirmation. HELP tentatively set Price’s hearing date for January 18, according to a Morning Consult report. Finance has yet to do so.

Though Republicans control the process, Schumer said he’s in talks with Senate Majority Leader Mitch McConnell.

“We have certain areas of leverage. We hope we don’t have to use them,” Schumer said.

Craig Holman, government affairs lobbyist for Public Citizen’s Congress Watch division, expects the OCE to take at least a preliminary look into Price to see if there is enough evidence to conduct a full investigation, though he was less optimistic about any SEC action.

By Public Citizen’s accounting from public documents, Price, a “prolific player on the stock market,” has made more than 630 stock trades since 2009–“right up into the current session,” Holman said, according to Rewire. The trail doesn’t prove that insider trading occurred but “certainly raises questions” about whether Price had knowledge of nonpublic material information, Holman said.

Schumer laid out a strong, if circumstantial, case against Price, who chaired the House Budget Committee and serves on other committees and caucuses with influence over health care.

“Let me remind you that Congressman Price’s influence and access to information on these healthcare issues was second to none,” Schumer said.

Schumer was joined by Sens. Patty Murray (WA) and Ron Wyden (OR), the top Democrats on the HELP and Finance committees.

Murray said that senators “will have to ask themselves if they are comfortable” with Price’s attacks on Medicare, Medicaid, and reproductive rights in addition to the allegations over his financial dealings.

Price belongs to a group falsely linking abortion care to cancer, says Rewire, and thinks “there’s not one” woman who can’t afford contraception. As head of HHS, Price could issue a new directive saying that birth control is not a preventive service to get rid of the Affordable Care Act benefit requiring insurers to cover all FDA-approved forms of contraception without co-pays.

Wyden promised a hard look at Price from Finance, the committee of jurisdiction for Medicare, Medicaid, and other health and human services programs.

“We are not going to let these hearings go forward where you are talking about health policy that touches on decades and decades of efforts to expand protections for vulnerable women. We’re not just going to have those hearings and pretend those issues are unimportant,” Wyden said. “We’re going to make sure that the country does not, without a conversation, just turn its back on decades of progress in terms of expanding health care choices to vulnerable women.”

Bottom Line:

Disheartening is what smacks of feigned righteous indignation over a call for a simple investigation into possible stock-trading impropriety and how patently obvious a question Price’s past and potentially current activities poses to his confirmation as HHS secretary.

A good old-fashioned witch hunt is pretty easy to spot, but it’s hardly such in this case. By Public Citizen’s accounting, Price has made more than 630 stock trades since 2009–that’s an average of 90 trades a year over the past seven years. Not quite a day trader, but a pretty serious player.

Democrats are not charging Dr. Price with any illegality–yet. They just want his stock-trading and any possible link to his position of political influence in the market brought into the sunlight where a relatively straightforward assessment of any impropriety can be made. Chances are he’ll come out with clean hands.

Steve's Take: #GOP is trying to quell matter before an investigation of @RepTomPrice ensues Click To Tweet

Still, the real problem I have has to do more with the GOP’s indignation, terming the call for more information about Price’s stock trading a “stunt.” This seems an attempt to quell the entire matter before any good faith (if there is such a thing on Capitol Hill anymore) investigation might ensue–something that starts to smell like a repressive, authoritarian approach to open, uncensored, democratic government.

I trust that Price’s confirmation hearing will proceed in the normal, due course of such congressional hearings and, like the aborted attempt to kill the Ethics Office, will constitute simply more GOP sound and fury, signifying nothing more worrisome. After Jan. 20, we’ll see fairly quickly if I’m right.