The passage of the STOCK Act was supposed, in the eyes of Congress, to end all the intense anger over Congressional insider trading. The system worked, in their eyes. A problem was identified and Congress worked to address it. Everyone goes home happy.

Except that’s not what happened. In a continuing series, the Washington Post delivered the goods on a host of abuses by members of Congress, both within the confines of insider trading and also well beyond them. First, they looked at how members reacted to their holdings in cases where they had lawmaking and oversight power over companies in those holdings.

One-hundred-thirty members of Congress or their families have traded stocks collectively worth hundreds of millions of dollars in companies lobbying on bills that came before their committees, a practice that is permitted under current ethics rules, a Washington Post analysis has found.

The lawmakers bought and sold a total of between $85 million and $218 million in 323 companies registered to lobby on legislation that appeared before them, according to an examination of all 45,000 individual congressional stock transactions contained in computerized financial disclosure data from 2007 to 2010 [...]

Sen. Tom Coburn (R-Okla.) reported buying $25,000 in bonds in a genetic-technology company around the time that he released a hold on legislation the firm supported. Rep. Ed Whitfield (R-Ky.) sold between $50,000 and $100,000 in General Electric stock shortly before a Republican filibuster killed legislation sought by the company. The family of Rep. Michael McCaul (R-Tex.) bought between $286,000 and $690,000 in a high-tech company interested in a bill under his committee’s jurisdiction.

This is not necessarily covered by the STOCK Act. That banned members of Congress and their staffs from trading on inside information about companies. This is a different animal, based on members trading in companies where they have oversight or lawmaking power. The information need not be inside, but members of Congress are well-positioned to conclude how legislation will impact industries based on entirely public knowledge. Executive branch officials cannot trade stocks in sectors where they have authority, yet members of Congress can do so.

And by the way, this affects legislation as much as it affects stock trading, which is more of a problem. A powerful lawmaker holding a major energy stock is unlikely to enact legislation that would reduce that company’s profits.

The next story, which comes much closer to an insider trading scenario, shows how members of Congress altered their portfolios after closed meetings with the Treasury Department and the Federal Reserve in 2008.

On Jan. 23, Boehner (R-Ohio) met Paulson for breakfast. Boehner would later report the rearrangement of a portion of his own financial portfolio made on that same day. He sold between $50,000 and $100,000 from a more aggressive mutual fund and moved money into a safer investment [...]

Boehner is one of 34 members of Congress who took steps to recast their financial portfolios during the financial crisis after phone calls or meetings with Paulson; his successor, Timothy F. Geithner; or Federal Reserve Chairman Ben S. Bernanke, according to a Washington Post examination of appointment calendars and congressional disclosure forms.

The lawmakers, many of whom held leadership positions and committee chairmanships in the House and Senate, changed portions of their portfolios a total of 166 times within two business days of speaking or meeting with the administration officials. The party affiliation of the lawmakers was about evenly divided between Democrats and Republicans, 19 to 15.

As you can see, this is a bipartisan problem. And this one does hew more toward insider trading; the information they received from Treasury or the Fed was not necessarily public.

I think the broader answer is that members of Congress should place all securities holdings into completely blind trusts (not fake “blind trust” where a spouse or financial advisor does the investing). As long as they make laws, which clearly have an impact on the economy and specific industries, they should not be able to use that insight for the purposes of playing the stock market. We don’t know how many members of the House have set up blind trusts, but of the 100 members of the Senate, only 6 have done so. Clearly the STOCK Act doesn’t go nearly far enough on this score. Congress comes with enough perks. Making money in the stock market based on their privileged position or access to non-public information shouldn’t be one of them.