Imagine this trade set-up: You are a staffer in US Congress. You get wind of every daily swing in the market-moving debt-ceiling deliberations. And you are allowed to trade on that information. Legally.

As the markets gyrate radically on every step (or lack of steps) by the US government, it makes the long-held political privilege more shocking then ever. Insider trading in US Congress is still legal.

This continued legal immunity for Congress is absurd. The invitation to corruption is outrageous. Nobody else in America can legally make insider trades. This would be akin to banning steroids in professional sports for everybody except major-league power hitters.

What's more shocking about this legal immunity is that as the government's influence on the market grows -- as witnessed by the 2008 financial bailout and this week's debt deliberations -- pressure has eased on introducing a ban on Congressional insider trading.

The Stop Trading on Congressional Knowledge (STOCK) Act HR 1148, which would have banned members of Congress and Congressional staffers from trading commodities and securities on nonpublic information, was introduced in March by Rep. Tim Walz (D-Minn.). The bill had four co-sponsors, including Louise Slaughter (D-N.Y.), who sponsored an earlier version of the STOCK Act. Other co-sponsors were Raul Grijalva (D-Ariz.), David Loebsack (D-Iowa), and Niki Tsongas (D-Mass.). What happened to the bill? Well, as you would expect, it died in committee, and has not been seen since.

How ridiculous is this? Well, if you didn't think the game was already rigged by corporate insiders and Wall Street bankers, it's even worse when you throw US Congress into the mix. In 2004, a now-famous University of Georgia study by Alan Ziobrowski found that US Senators beat the average stock market performance by 12%. That's even better than the 7.4% above-average gain by corporate insiders. Average US households, on the other hand, generally lag the market by 1.2%. A follow-up Ziobrowski study this year found members of the US House of Representatives outperformed the market by 6%.

Coincidence? I doubt it.

There are many well-documented cases of staffers making some nice coin off of market moves. Here are some examples:

• Tony Rudy, a staffer for former House Majority Leader Tom DeLay (R-Texas) was not only involved in DeLay's corruption scandals -- which forced DeLay from office and resulted in his conviction on money laundering charges -- but he also profitably day-traded, making more than 500 trades from the computer in his Capital Hill office, the Washington Post reported. Rudy also admitted to accepting $86,000 in payments and gifts from Jack Abramoff, as part of the scandal that booted DeLay from power.
• The Wall Street Journal found many members of Congress made risky bets that stock markets would fall in 2008, the year of the financial crisis. The newspaper's study of Congressional trading activity found "investment accounts of 13 members of Congress or their spouses show bearish bets made in 2008 via exchange-traded funds... These funds were leveraged; they used derivatives and other techniques to magnify the daily moves of the index they track." Though the Journal concluded there was "no evidence the legislators used privileged information or failed to follow rules or disclosure," does it matter if they did? Because it would have still been legal.
• The Wall Street Journal also found Congressional staffers benefited from their fortuitous market timing. For example, energy policy adviser Chris Miller doubled up his money on a trade when advising on legislation that benefited his investment. The Journal found 72 aides who had traded shares of companies affected by legislation their bosses were working on.

Again, I'm not sure what the point is of proving all this if it's entirely legal. It seems the only repercussion for members of Congress or their aides is bad publicity. What needs to change is the law. Congress should abide by the same rules as everybody else -- insider trading should be illegal in US Congress. It's yet another reason that the public has reason to distrust the power of government in the markets.