by Jerry Alatalo
ou wonder if the announced candidates for President of the United States will become asked for their opinions on Bernie Sanders’ legislation to break up America’s largest banks. Nah… probably not. Why would the hosts of “Face the Nation”, “Meet the Press”, along with Fox News, CNN and other network talk shows ask Hillary Clinton, Jeb Bush and all candidates for president about some “boring” proposed law just because it’s historic? President Teddy Roosevelt breaking up Rockefeller’s Standard Oil monopoly kind of historic. The kind of legislation that future schoolchildren read about in their history books kind of historic.
Network news talk show hosts aren’t going to waste viewers valuable time getting into “boring” statistics that Vermont’s Bernie Sanders spoke about in announcing the financial legislation, like: 14 individuals over the past two years saw their wealth increase by $157 billion – equal to the combined total wealth of 130,000,000 (130 million) Americans. What American citizen has any interest in hearing about wealth inequality that is historic? That future school kids read about…?
If those talk show hosts were questioned why they won’t ask their guests’ opinions on banking laws Sanders and Brad Sherman of California are pushing for, they’ll probably respond with – if totally honest, “Owners of the network sit on the Boards of Directors and are stockholders of the largest banks, along with the boards of those banks’ largest corporate customers, and they spend a lot on advertising… you know, so if I asked about Sanders’ and Sherman’s legislation it could get somewhat uncomfortable for me, you know what I mean? You know… right?”
In 1999, Bernie Sanders opposed, unsuccessfully, repeal of the Glass-Steagall Act – enacted into law after the Great Depression to prevent another one – which opened the way for highly risky financial speculation using complex financial instruments such as derivatives, and responsible for the worldwide economic collapse of 2008. Worldwide derivative exposures are estimated in the hundreds of trillions of dollars. During that same time, Sanders opposed Federal Reserve Chairman Alan Greenspan, Treasury Secretary Robert Rubin, President Bill Clinton’s (his wife’s name is Hillary) chief economic adviser Larry Summers and Wall Street lobbyists as they pushed an agenda of “wonderful” financial sector deregulation.
2016 Presidential candidate/Senator Bernie Sanders of Vermont and Representative Brad Sherman of California are trying to prevent another occurrence of world depression.
Press release: | www.sanders.senate.gov
Sanders Files Bill to Break Up Big Banks
Wednesday, May 6, 2015
WASHINGTON, May 6 – Sen. Bernie Sanders (I-Vt.) today introduced legislation to break up the nation’s biggest banks in order to safeguard the economy and prevent another costly taxpayer bailout. Rep. Brad Sherman (D-Calif.) proposed a companion bill in the House.
“No single financial institution should have holdings so extensive that its failure could send the world economy into crisis,” Sanders said. “If an institution is too big to fail, it is too big to exist.”
The biggest banks in the United States are now 80 percent bigger than they were one year before the financial crisis in 2008 when the Federal Reserve provided $16 trillion in near zero-interest loans and Congress approved a $700 billion taxpayer bailout.
“Never again should a financial institution be able to demand a federal bailout,” Sherman said. “They claim; ‘If we go down, the economy is going down with us,’ but by breaking up these institutions long before they face a crisis, we ensure a healthy financial system where medium-sized institutions can compete in the free market.”
The 2008 financial crisis had a devastating impact on the U.S. economy. It cost as much as $14 trillion, the Dallas Federal Reserve calculated. The Government Accountability Office pegged the cost at $13 trillion. The Congressional Budget Office estimated that the crisis nearly doubled the national debt and cost more than the Bush tax cuts and the wars in Iraq and Afghanistan combined.
The six largest U.S. financial institutions today have assets of some $10 trillion, an amount equal to almost 60 percent of gross domestic product. They handle more than two-thirds of all credit card purchases, control nearly 50 percent of all bank deposits, and control over 95 percent of the $240 trillion in derivatives held by commercial banks.
The Sanders and Sherman legislation would give banking regulators 90 days to identify commercial banks, investment banks, hedge funds, insurance companies and other entities whose “failure would have a catastrophic effect on the stability of either the financial system or the United States economy without substantial government assistance.”
The list would have to include Bank of America, Bank of New York Mellon, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, State Street and Wells Fargo. These eight institutions already have been deemed “systemically important banks” by the Financial Stability Board, the international body which monitors the global financial system. Under the legislation, the U.S. Treasury Department would be required to break up those and any other institutions deemed too big to fail by the treasury secretary. Any entity on the too-big-to-fail list would no longer be eligible for a taxpayer bailout from the Federal Reserve and could not use their customers’ bank deposits to speculate on derivatives or other risky financial activities.
(Thank you to Bernie Sanders at YouTube)