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Culture War Roundup for the week of May 27, 2024

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If you explained the crime in a few sentences to George Washington, would he say, "what? I don't even understand why that is a crime in your era." Or would he say, "Of course that is a crime."

You don't think insider trading should be considered a crime?

Isn't that mainstream thinking among many economists?

Regardless shareholder disputes in the Dutch East Indies company are documented as early as 1605, so the concept of short sellers, insider trading, and shareholder advocates was all mainstream by the time of Washington.

I don't think we should be selectively picking and choosing lawmakers and pedantically going through their actions to decide whether their actions do or do not technically count as "insider trading" or not and then prosecuting the ones that the prosecutor chooses to prosecute at their own discretion.

Instead I think we should make a new law that unambiguously singles out lawmakers, prevents them from buying/selling/owning anything other than specially licensed (and public) index funds, limit their transactions to certain times of year, and also prevent external sources of income. Then ruthlessly enforce that law on all of them, which should be tailor-made to be less ambiguous than existing insider trading laws which are not designed with politicians in mind.

Obviously this will never happen because the politicians are the ones who make laws and don't want to cripple their own sources of income. But if it magically happened then I would feel comfortable prosecuting it.

"Hey George, some lawmakers are buying companies, then passing laws favorable to those companies. Think that should be illegal?"

It's really not hard.

That's not insider trading as it's usually defined. Insider trading is more like knowing your company had a good quarter and so buying shares before publicly releasing this news.

Yeah I suppose so. Washington seems like a pretty bright guy though--I don't think it would take him long to grasp the concept.

Insider trading can easily be compared to betting on a fixed match, something George Washington would recognize as wrong.