On the recordJune 30, 2010
I might say that it's not a question of if the system will fail again, but only when it will fail again. This used to not be allowed under the Glass-Steagall, which prohibited commercial banks from doing investment activities and investment firms from taking deposits. The two were kept separate. However, in 1999, the Graham-Leach-Bliley bill repealed Glass-Steagall and the walls came down between commercial banking and speculating. Gambling and prudent lending need to be separate again. I have introduced H.R. 4377, the Return to Prudent Lending Banking Act which strengthens the Glass-Steagall separations and repeals some of what Graham-Leach-Bliley did. We know instinctually that we need to break up the big banks and increase competition across our financial system. Instead, the megabanks stay too big to fail, and the American taxpayers will pick up the tab when they implode the economy at some date in the future. That is their pattern. That is their history. Regulating derivatives is an excellent example of Congress knowing what we need to do but not doing it. Regulating all derivatives openly and clearly should be expected with no exceptions. Nothing less is acceptable.
