A prediction market trader won $400,000 on Polymarket for predicting the capture and arrest of Venezuelan President Maduro hours before it happened. This anonymous winner’s earnings have prompted questioning into potential insider trading.
In an effort to crack down on Congressional trading, Representative Ritchie Torres (D-NY) has introduced a bill to ban insider trading and prediction markets for the federal and legislative branch. He speaks to Jen about how this bill can protect our political institutions and what enforcement mechanisms could guarantee its success. The two also discuss the impending ACA subsidy extension vote, the mess from Maduro’s arrest, and the red states that would benefit the most from healthcare reform.
Congressman Ritchie Torres is the U.S. Representative for New York’s 15th congressional district. He is a member of the Committee on Financial Services and the House Select Committee on the Chinese Communist Party. Previously, Torres served as the New York City Councilmember for the 15th district. Torres was the first openly LGBTQ+ candidate to be elected to legislative office in the Bronx, and the youngest member of the city council.
Jen Rubin
Hi, this is Jen Rubin, Editor-in-Chief of the Contrarian. We’re delighted to have back with us Representative Richie Torres from New York. Welcome, Congressman.
Ritchie Torres
Always a pleasure to be here.
Jen Rubin
You have introduced a bill that turns out to be very timely concerning insider trading on prediction markets. We just had an incident, apparently, in which somebody, we don’t know who, made $400,000 betting on Maduro’s exit. Tell us about your bill, and how it would help prevent situations like this.
Ritchie Torres
Yeah, so I’m introducing legislation that would prohibit insider trading in prediction markets among federal government officials. where the potential for corruption is greatest. So imagine if you were a member of the inner circle of Donald Trump. I don’t mean to cause you nightmares. And you were part of the decision. as to whether Maduro should be removed and captured. As a member of the inner circle, and as a participant in the prediction markets, you could place a bet. predicting the capture of Maduro, and then advocate for a government outcome that would personally benefit you. And for me, there should be no tolerance for insider trading in the ranks of the federal government, because it not only corrupts the market, it corrupts the government itself.
Jen Rubin
Exactly. One of the prediction markets, Kashi, has said… come out and said that they support the bill. Have you heard from other prediction markets?
Ritchie Torres
I know… Kelshe and Polymarket have reached out to my office for a meeting, and were aware that Kalshi came out in favor of the legislation, but what is the possible argument against insider trade… against insider trading… insider trading ban for federal officials? You know, as a member of Congress, I could, in theory. Open an anonymous account, and place a bet predicting that I’m gonna appear on Jen Rubin’s show. And then profit from the bet the moment I appear on your show. Like, in what universe should that be remotely legal?
Jen Rubin
Exactly. Because these accounts are anonymous, how would you enforce, how would you police the bill that you’re talking about?
Ritchie Torres
Well, I suspect the prediction market firms themselves, the platforms, have the ability… to determine the identity behind the anonymous accounts, and so we would treat it as we would any other investigation, right? The CFTC would have the authority to investigate allegations of insider trading, and with it comes all the investigative tools, like subpoena power.
Jen Rubin
Have you heard from your Republican and Democratic colleagues? What do people think about this?
Ritchie Torres
We’re building support among our Democratic colleagues. The Republicans have been suspiciously silent, so… but for me, there’s nothing inherently partisan. about the legislation. You know, Fiorello LaGuardia once said there’s no Democratic or Republican way to take out the trash. There’s no democratic or Republican way to police our markets, and to protect the integrity of both the market and the government. It’s just common sense. Unless you’re pro-corruption and pro-leaving the garbage inside Washington, I suppose. Corruption is not a bug, but a future of the Trump presidency, so…
Jen Rubin
Exactly, exactly. We have a vote, a procedural vote, coming up in the House today on a 3-year extension of the subsidies. What do you think the chances of passage are?
Ritchie Torres
Look, I have no choice but to be optimistic, and there are Republicans in swing districts, and one of the ironies of the tax credits is that it disproportionately benefits red states.
Jen Rubin
Yes.
Ritchie Torres
75% of the recipients are in red states that voted for Donald Trump. And so it is quite ironic that you have blue state representatives like me largely defending the interests of red state voters, who depend heavily on these Obamacare tax credits. And, you know, Donald Trump is betraying the American people on the issue that matters most, which is affordability.
Jen Rubin
And if these people had just raised their voices when the funding bill was up in the fall. We theoretically could have avoided, we’ll get to the Senate in a moment, the entire shutdown. So they’ve done a 180, and it seems as though Democrats were exactly right to hold out, because they’ve done a complete about-face.
Ritchie Torres
Democrats took a stand on the issue that matters most to most voters, which is the cost of healthcare. I mean, the cost of healthcare has risen by 121% since 2000. And without the Affordable Care Act tax credits, those costs are in danger of doubling for 24 million Americans. Which, for Democrats, is an unacceptable situation.
Jen Rubin
Right. The Senate is apparently working on some kind of compromise, which would be 2 years, which would eliminate zero premium plans. Do you know enough about that bill yet to be optimistic about whether there’s a compromise there?
Ritchie Torres
I have no insight into what is happening in the Senate. There’s an old saying, the other party is the adversary, and the Senate is the enemy.
Jen Rubin
Yes, indeed, indeed. Let’s shift for a moment to Venezuela. We have just an unprecedented, old-style colonial war, unconstitutional, the president didn’t come to Congress to ask. Now he’s talking about running the country, about him controlling oil revenues, about him, deciding, that the current regime, not a democratic, small D, democratic regime, will run the place. What is Congress, if anything, prepared to do at this point?
Ritchie Torres
Well, Congress has gone too far in ceding too much power to the executives. Like, the authoritarianism of Donald Trump is as much a function of congressional capitulation.
Jen Rubin
Yes.
Ritchie Torres
as it is of Donald Trump himself. And the stakes are high, and the argument that Donald Trump is making is dangerous. So common sense dictates that an invasion of a foreign country And a removal of a foreign leader is, by definition, a military action. And arguably, an act of war, or an action that could result. and war, right? The Trump administration is arguing that if you indict a foreign leader, then the indictment magically converts a military action into a law enforcement action, and therefore removes the constitutional requirement for congressional approval. Like, that is a dangerous argument that we have to confront head on.
Jen Rubin
Absolutely.
Ritchie Torres
And by that logic, you would never… you could just indict any leader. Like, imagine George W. Bush had said, instead of, even though that was the wrong decision, I thought, instead of going to Congress.
Jen Rubin
Let’s just indict Saddam Hussein, and then we can invade the country and call it a law enforcement action. Exactly. I can apply that logic anywhere. And it’s bizarre, because they claim that the action in taking out the boats, murdering people on boats, even after they were shipwrecked, was not a law enforcement action, but that was a military action. So, is there any explanation for this inconsistency in the administration?
Ritchie Torres
But, you know, I have to say, Donald Trump is a paradox. He’s both the most honest and dishonest person. I mean, he’s dishonest because he lies pathologically, but he’s been brutally honest about his.
Jen Rubin
Yes!
Ritchie Torres
He could keep… he has no concern for human rights, or democracy, or rule of law, and this action is not even primarily about drugs or migration. It is about oil. And he admits it openly, and Venezuela has the largest proven oil reserves in the world, over 300 billion barrels, and Donald Trump feels he’s entitled. to Venezuelan oil. And that’s what this is about. And if Donald Trump were so concerned about drug trafficking, because this is the pretext that the Trump administration often brings up, why would he pardon the former president of Honduras? Who is convicted of drug trafficking. And if you’re convinced that the Maduro government is a regime of drug trafficking, then why would you keep in power his vice president, who’s a Maduro loyal president? Like, none of it makes sense. None of it makes sense.
Jen Rubin
Donald Trump may actually have to lure the oil companies back in, because they’re not all that thrilled about going back in. They realize they could be nationalized in a couple years. Can Congress step in here to use the power of the purse to prevent Donald Trump from essentially bribing the oil companies, to prevent him from supporting a regime that is not democratic? What, if anything, do you think Republicans might be prepared to do?
Ritchie Torres
Well, first, you know, Donald Trump it cannot think beyond stage 1. It cannot think about the long term. Like, Venezuela’s oil sector has atrophied from disinvestment and neglect for days. My understanding is that reinvigorating the oil sector of Venezuela would cost at least $60 billion. And it’s a process that unfolds over the course of a decade, and that’s the best-case scenario. Who’s gonna risk $60 billion in a country that has no long-term stability.
Jen Rubin
In a country that is a failing state.
Ritchie Torres
where 8 million people have fled. Like, Donald Trump just has no understanding.
Jen Rubin
Of complexity in the long term, and that’s why he’s unqualified to be president. Absolutely. Are Republicans that you’ve spoken to at all uneasy about this? Are they willing to take any measure, even to prevent him from attacking, I don’t know, Greenland, or… Denmark or, other allies?
Ritchie Torres
But… you know, Donald Trump has such an iron grip on the Republican Party that I see no evidence of dissent, even The senator from Utah reversed his position. Upon receiving a call from… he suddenly discovered that the President is Article 2 power.
Jen Rubin
Yes, that would be Saturday.
Ritchie Torres
You bet a country without, congressional approval. But, you know… Here’s what I would tell my Republican colleagues who are cheerleading The, the regime change.
Jen Rubin
Right.
Ritchie Torres
You know, it is easy, To support unilateral presidential action. when it produces the outcomes that you favor. Well, what happens when it produces the outcomes that you disfavor? It’s easy to do it when that power is in the hands of a president you like, but what happens if it’s in the hands of a president you dislike? Like, what’s to stop? You could imagine a president from much farther on the left. who… tries to criminally indict maybe the Prime Minister of Israel. And then authorizes an invasion. Like, is that something the Republicans would approve of? Like, that’s… they don’t think through the precedent that’s being set, and how that precedent could be followed in the future.
Jen Rubin
Absolutely. We also have, another funding cliff, in, January. From what I understand, the appropriators are making some progress in marking up bills. Do you think there will be another shutdown, or do you think there’s gonna be a deal to be struck just on the Spending components of the remainder of the budget.
Ritchie Torres
I mean, it feels like there is progress toward a negotiated outcome, although you never know for sure in Washington, D.C, and, you know, Majority Leader Chuck Schumer has has all but ruled out the possibility of a government shutdown, so… Understand. If I were placing a bet in the prediction market, I would bet against…
Jen Rubin
Yes.
Ritchie Torres
A government shutdown.
Jen Rubin
Yes. So, as you head out on the trail, I think you’re probably a lot for re-election, but in support of your other colleagues and other candidates. How do you kind of put this all together for them? How do you explain why they should care about Venezuela, or why we need a democratic Congress? What’s the big picture here?
Ritchie Torres
I mean, Donald Trump has broken his promise to the American people. Right, he ran on an America First platform. promising… No more endless wars. No more foreign entanglements. And here he is. Invading a foreign country, Removing a foreign leader. And announcing that he’s gonna run Venezuela. So, time spent on managing Venezuela is time not spent on lowering the cost of housing and healthcare and food and utilities here in the United States. And so, while Donald Trump is entangling the United States in forever wars abroad, we Democrats are going to focus like a laser on lowering your cost. And that’s…
Jen Rubin
That sounds like a…
Ritchie Torres
We could show it for the American people.
Jen Rubin
That sounds like a rather effective, message. We just had the anniversary of January 6th, and Democrats, I think, did a really impressive job of re-presenting the facts to the American people. How optimistic are you that in the long run, the facts will prevail, the true story of January 6th will become the official account? The administration has put up a website of lies and continues to spin conspiracy theories. Is that gonna work for them?
Ritchie Torres
You know, it is… there’s a common refrain, history is written by the victors, and so we have to win. That is a.
Jen Rubin
That is a powerful, rejoinder, absolutely. Well, thank you, Representative Torres. You have been a stalwart in your support of the subsidies, and you come from one of the districts that is going to be most affected, not only by this, but by Medicaid cuts, SNAP cuts, and so, you continue to advocate on behalf of your constituents very well. So, thanks so much, and thank you for spending time with us. We really appreciate it.
Ritchie Torres
Always a pleasure.
Jen Rubin
Take care.
