Two big articles on economic disparities between members of Congress and their constituents appeared on December 27th, one in the New York Times and one in the Washington Post. (Not sure if there is anything behind the coincidence).
The Times article is more about how members of Congress (MC’s) have been relatively sheltered from the economic downturn. It includes a brief discussion of whether MC’s use their insider connections to benefit in the stock market, including a reference to a paper by Jens Hainmueller and Andrew Eggers:
While the housing collapse nationwide has hurt many Americans, lawmakers still find the real estate sector the most popular place to park their money, statistics from the Center of Responsive Politics show, and members of Congress continue to profit from their investments there. Perhaps the most tantalizing but hotly debated factor in the rising wealth of Congress is lawmakers’ performance in the stock markets — and the question of whether they are using their access to confidential information to enrich themselves.
In a study completed this year, Mr. Ziobrowski at Georgia State and his colleagues found that House members saw the stocks they owned outperform the market by 6 percent a year. Their research from several years ago found that senators did even better, at 12 percent above average. The researchers attributed the performance to a “significant information advantage” that lawmakers hold by virtue of their positions and the fact they are not bound by insider-trading law.
However, a separate study last year by researchers at Yale and the Massachusetts Institute of Technology found that the portfolios of lawmakers actually performed somewhat worse than average investors. It found that members did do better when investing in companies in their home districts or associated with campaign donors — suggesting that they benefited from their political connections — but still not as well as the average investor.
The Post article is more about the absolute level of wealth of MC’s versus their constituents, and includes a quote from Duke political scientist Nicholas Carnes:
A representative’s occupation before being elected influences how liberal or conservative he or she is in voting, according to an analysis of more than 50 years of congressional votes by Duke University professor Nick Carnes.
In order from most conservative to most liberal: farm owners; businesspeople such as bankers or insurance executives; private-sector professionals such as doctors, engineers and architects; lawyers; service-based professionals such as teachers and social workers; politicians; and blue-collar workers, according to the analysis, which is being published in Legislative Studies Quarterly.
Carnes said that while party affiliation is the strongest determinant of voting records, “the differences between legislators of different occupational backgrounds are pretty striking. People tend to bring the worldview that comes with their occupation with them into office,” he said.
The Post article has almost 5,000 comments; the Times article about 250, as of this writing.