"It is despicable": House Democrats rage over Republican stock trading "set-up"

House Democrats went into the vote on the Stop Insider Trading Act last month groaning that it was all a big Republican set-up. Now they're fuming that the trap has been sprung.

Why it matters: A well-funded Republican group is blanketing the airwaves lauding GOP lawmakers in key swing districts — including some with reputations for prolific stock trading — as champions on the issue.

• "Corrupt congressmen treat the House floor like a trading floor. Thankfully, Congressman Rob Bresnahan voted to stop it," says one of the ads.
• Issue advocacy group Choose Freedom Inc. has put a whopping $9 million into running the spots across nearly 20 congressional districts, according to ad tracking firm AdImpact.

Catch up quick: The House voted 232 to 198 in July to pass the Stop Insider Trading Act, which would ban members of Congress and their families from purchasing individual stocks.

• The bill only applies to the legislative branch, however, and has carveouts for holding onto and selling pre-owned stocks, and buying pooled investment vehicles such as mutual funds and ETFs.
• The bill "allows members to still own stock and doesn't include the president or cabinet," Rep. Debbie Dingell (D-Mich.), who chairs House Democrats' messaging and policy arm, told Axios.
• House Democrats also fumed at the inclusion of an unrelated provision in the bill requiring photo ID to vote in federal elections — and in the end, only 13 of them voted for it.

What they're saying: "To call this a stock trading ban is disgraceful," Rep. Joe Morelle (D-N.Y.), the ranking member of the House Administration Committee, said in an interview with Axios.

• "I don't know how anybody would sign off on this," he said of the ad campaign. "This is why people in America hate politics. This is really as reprehensible as I've seen."
• Dingell said Democrats "will pass a bill that bans owning stock and include the administration" within "the first 100 hours" of a Democratic House majority.

"Republicans are the singular reason why a REAL ban on congressional stock trading has not become law this year," Justin Chermol, a spokesperson for the Democratic Congressional Campaign Committee said in a statement.

• "Everyone knows it, and that's why these lies won't hold in the court of public opinion."

Yes, but: One House Democrat, speaking on the condition of anonymity to contradict their party leadership's messaging on the vote, said they are "not remotely shocked" it is now being used against Democrats.

• "This was such an obvious set-up and we just fell right for it," said the lawmaker.

Between the lines: Some Democrats bitterly noted the irony behind the group praising Bresnahan (R-Pa.) specifically on stock trading, pointing to the considerable public scrutiny he has faced on the topic.

• "For Rob Bresnahan in particular, who is the poster child for a member who is making countless trades, it is despicable. It's reckless," said Morelle.
• Bresnahan has denied having any personal involvement in his trades, and his portfolio's activity has reportedly slowed in recent months.
• Morelle continued: "He should be ashamed of himself, but I don't think 'shame' is in his vocabulary. He can't be embarrassed."

The DCCC and Bresnahan's Democratic opponent Paige Cognetti have both run ads slamming him on stock trading.

The other side: "Calling someone else 'shameless' is a masterclass in projection after Morelle refused to vote for the bill," the Bresnahan campaign said in a statement to Axios.

• "Perhaps next time he can put his name on common-sense legislation that would benefit the American people instead of crying that someone else actually did something to solve the problem."

Zoom out: Choose Freedom Inc. is running identical ads praising swing-district Reps. Mike Lawler (R-N.Y.), Monica De La Cruz (R-Texas), Mariannette Miller-Meeks (R-Iowa), Juan Ciscomani (R-Ariz.), Rob Wittman (R-Va.), Ryan Mackenzie (R-Pa.). Bryan Steil (R-Wis.), Scott Perry (R-Pa.), Derrick Van Orden (R-Wisc.) and Brad Finstad (R-Minn.).

• It also has spots running for Jay Obernolte (R-Calif.) and Brett Guthrie (R-Ky.), neither of whom is a top target for Democrats in November.

Zoom in: Another ad from the group hits Rep. Gabe Vasquez (D-N.M.), one of House Democrats' most vulnerable incumbents, for voting against the bill.

• "Members of Congress are making millions in the stock market, trading thousands of stocks instead off doing their jobs," the ad says.
• It continues: "Vasquez voted against the bill that would stop insider trading. We continue to struggle as his friends profit. Tell Congressman Vasquez to help our community, not his cronies."
• Morelle, who has helped spearhead efforts to craft a bipartisan stock trading ban, said Vasquez "has been a leader in this effort."

"House Democrats were handed a chance to ban insider trading in Congress and chose their stock portfolios instead," said Mike Marinella, a spokesperson for the National Republican Congressional Committee.

• "Every single Republican voted to end it. Democrats protected their own bank accounts. Republicans will protect yours."