Bernie Sanders’ Election Would Mean the End of ‘Too Big To Fail’ on Wall Street

[LiberalArkie]

BY LARRY COHEN

On January 5 at Town Hall in New York City, Bernie Sanders delivered a major policy speech in which he declared that he will “break up any banks that are too big to fail and that big bankers will not be too big to jail.”

His speech and the audience reaction almost seemed like an alternate ending to Adam McKay’s new blockbuster film on the 2007-08 financial meltdown, The Big Short. After watching the movie’s portrayal of how Wall Street’s greed and recklessness led to our economy’s collapse, it’s hard to argue against Sanders’ demands to increase taxes on the billionaires and break up the banks, and use the revenue to fund better health care and education.

Sanders advocates a modern Glass-Steagall Act (the first one was repealed by President Bill Clinton, who in 1999 called the act “no longer appropriate”) that would separate commercial and investment banking, and thereby separate home mortgage banking from speculation involving derivatives of those same mortgages. When you add in Sanders’ demands to end Super PAC campaign funding and his own refusal to accept Wall Street funds in the current campaign, we are presented with a sharp contrast to Hillary Clinton, who opposes reinstating Glass-Steagall and has taken upwards of $6 million from Wall Street supporters.

In the last 50 years the financial sector’s share of our GDP has almost quadrupled. The Big Short illustrates how Wall Street keeps up that growth with little increase in real value but lots of high salaries and high living for bankers. As the film concludes, viewers realize we haven’t done much to change the financial sector’s rules since the crisis. Once Fed chair Ben Bernanke and Treasury let Bear Stearns fail and Lehman Brothers go bankrupt, they bailed out the rest and the culture of self-interested high living returned. Whether the next financial bubble is around housing or something else, the result is likely to be the same as in 2008.

Snip

http://inthesetimes.com/article/18746/Bernie-Socialism-Banks-Hillary-Clinton-Revolution-Wall-Street

[randys1]

1. In theory, not in reality. We all get that, right? I point out the reality Bernie faces as

president as in the obstructionist moron teaparty because I need to remind people how very important down ticket is and this means you all need to be focused on registering voters.

[mmonk]

3. Do you know for a fact he couldn't do

anything at all with executive powers?

[randys1]

4. NO, I dont, and I am curious about that. I doubt he would if he could for the same

reason Obama hasnt done more with it.

The backlash could be very bad.

Remember who we are dealing with.

But if anyone would do it, it is Bernie

[LonePirate]

5. Agreed. Without a supportive Congress, big changes are difficult or impossible for any president.

If the Repubs control one or more houses of Congress next January, much of Bernie's agenda is DOA.

[Betty Karlson]

2. Good. "Too big to fail" hasn't overstaid its welcome, but

that's only because it was never welcome to begin with.