Skip to content

With the U.S. economy potentially on the brink of default, Washington insiders on and off the Hill have had something much more personal on their minds: what to do with their own money in the midst of the debt crisis.

Members of Congress are under no obligation to talk about their own financial matters, and few are willing to. They report their holdings each year and will have to disclose next summer whether they shifted investments out of stocks in the midst of the debt ceiling debate.

But even if Members are remaining mostly mum, downtown lobbyists who are closely following the debt debate say personal money matters have become a big topic of conversation on K Street and Capitol Hill.

“For people like us here, we are, for better or worse, all consumed with this debate,” said Jack Howard, vice chairman and chief operating officer of Wexler & Walker Public Policy Associates. “We’re hearing chatter from people saying they’re going to take all their money out of whatever investments they have and move it into cash, at least for the next few months.”

Howard, a longtime Hill aide who worked for former Speaker Newt Gingrich (R-Ga.), said he’s not among those pulling money out. “I’m just going to ride it out,” he said.

But a couple of weeks ago, colleagues asked him what they should do with their investments, and he told them, mostly in jest, to “buy gold.”

“Looking back,” he said, noting that gold has surged in value, “I wish I had.”

Another K Streeter, Democrat Andy Rosenberg of Thorn Run Partners, didn’t purchase gold but decided to move a significant portion of his retirement savings out of the potentially volatile stock market and into cash.

“The logic behind it was that I didn’t know with any sense of certainty that things would turn ugly but that my assumption was that the risk of an abrupt downturn outweighed the potential benefit of staying long in the market,” explained Rosenberg, whose father is a financial planner to whom the lobbyist sends daily political updates. “I still think the risk is real.”

The few Members of Congress who would talk about their personal investments reported through spokesmen that, unlike Rosenberg, they are staying put in the markets.

House Financial Services ranking member Barney Frank (D-Mass.) “has not” removed any personal investment money from the stock market, spokesman Harry Gural said. “He has a lot of his money in Massachusetts bonds,” Gural added.

And a spokesman for House Assistant Minority Leader James Clyburn (D-S.C.) said his boss did not plan to change any of his investments.

Other Members’ offices were more vague, or simply had no comment, about the boss’s portfolio.

When asked whether her boss had moved any money out of the stock market, Laena Fallon, a spokeswoman for House Majority Leader Eric Cantor (R-Va.), emailed: “He’s been a little busy.” In a follow-up email, she clarified: “My point is he hasn’t had time to be focused on the location of his investments.”

Speaker John Boehner’s spokesman, Michael Steel, explained in an email that the Ohio Republican’s “investments are handled by an outside advisor — he doesn’t weigh in on day-to-day trades.”

Of the more than 30 House and Senate leaders, chairmen or ranking members of money-minded committees or lawmakers who have declared that they will not vote to raise the debt ceiling, most did not respond to requests for comment submitted to their press offices.

While K Streeters say they understand that Members have to be careful about what they say publicly as it could spook the markets, they would still like to know in real time what financial moves lawmakers have taken amid the crisis.

“Investors would certainly benefit from knowing what economic bets lawmakers were making on the consequences of their official actions, much as they do from watching corporate insiders’ trades,” said Bruce Mehlman, a GOP lobbyist and founder of Mehlman Vogel Castagnetti.

And with good reason. Members of Congress tend to be savvy investors.

According to Roll Call’s annual 50 Richest Members of Congress reports, lawmakers’ financial portfolios have fared particularly well, even during the recent economic recession.

The details of their investments aren’t easy to track, even after their personal financial disclosures are revealed. But they can still cause trouble for some Members, such as Sen. Dick Durbin (D-Ill.), who disclosed that he had sold some mutual funds holdings in September 2008 after Bush administration officials warned lawmakers that the economy was in serious trouble.

If Members of Congress were “moving money around in concern about the volatility of the markets, it would be virtually impossible to detect that off the personal financial statement,” said Ken Gross, an ethics lawyer at Skadden, Arps, Slate, Meagher & Flom. “You’d have to speculate.”

Recent Stories

Senate readies stopgap as House tries again on full-year bills

Military pay, typically exempted during shutdowns, is at risk

Menendez expects to win ‘biggest fight yet,’ defends seized cash

Cardin to take Foreign Relations gavel after Menendez charges

Lee, administration officials issue plea for five-year PEPFAR

Vilsack sees shutdown taking away children’s food, farmers’ loans