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Baldwin Seeking Path For Buybacks, Short-Term Bills Through Appropriations Process

Sen. Tammy Baldwin on Thursday said she’d like to use the appropriations process to advance two measures that would beef up federal oversight and disclosures of hedge fund practices related to stock buybacks and short-term activist investments.

But the Wisconsin Democrat will need to wait if she wants the bills to make it into law via a spending bill. At Thursday’s Senate Appropriations Committee markup of the fiscal year 2017 financial services and general government agencies measure, she said she wouldn’t offer the amendments because of a bipartisan commitment to keep the measure free of controversial policy riders. The fact that her proposals are controversial in the first place, Baldwin said, was puzzling.

“I hope that in the future we can work together, because these are critical issues and we have ignored them for too long,” Baldwin said.

One of the amendments was legislation that Baldwin introduced in March with support from Sens. Jeff Merkley (D-Ore.) and Bernie Sanders (I-Vt.) and a handful of other Democrats. It aims to discourage “short-term,” dividend-focused investments by hedge funds by shortening their mandatory disclosure window from 10 days to two days, according to Baldwin’s office.

That bill, S. 2720, has been dubbed the “Brokaw Act,” named after a small town in Wisconsin whose main employer, a paper mill, went dark after an activist hedge fund forced its closure.

At Thursday’s markup, Baldwin also said she wanted to offer an amendment to the financial services funding bill that would require the Securities and Exchange Commission to conduct a study into large-scale stock buybacks, which she called a “chief cause of the stagnation of American wages and investment” that “could be a potential source of long-term national decline.”

Baldwin said she was “rather shocked that anyone would consider them controversial riders,” without specifying who took issue with the amendments.