Forum Post: Bankers deploy to block Glass Steagall

Wall Street's alarm is building over the cross-party, non-partisan momentum in the United States for restoring FDR's 1933 Glass-Steagall Banking Act as the law of the land. Now those fighting for it must escalate to force Congress to pass Glass-Steagall not next year, but in the lame duck session.

The banksters are hysterically deployed to block the likely appointment of Glass-Steagall advocate Senator-elect Elizabeth Warren to the Senate Banking Committee. Mother Jones magazine reports Nov. 19 that the bank lobby is "going nuts," pressuring members of the Senate Banking Committee to not appoint Warren — before she has hired staff or been assigned an office. Mother Jones recognizes that "what may trouble the big banks most is Warren's call for revisiting the Glass-Steagall Act, which separated riskier investment banks from more staid commercial banks. Reinstating Glass-Steagall would mean breaking up sprawling Wall Street institutions such as JPMorgan Chase, Citigroup, and Bank of America."

The Consumer Federation of America's Director of Financial Services, Tom Feltner, backs Warren, and the liberal Daily Kos website has launched a petition aimed at Democrat Senate leaders to name her, Mother Jones reports.

Conservative Republican Samuel Goldman, writing in The American Conservative yesterday, also warmly supported Warren's appointment to the banking committee, because of her support for Glass-Steagall. "Warren appears to be a conventional liberal Democrat on most issues. But she is a passionate and distinctive voice on financial reform, including reinstating some version of the Glass-Steagall separation between commercial and investment banking. The merits of such a proposal depend on its details. In general, however, breaking up the big banks, which would diversify the marketplace and reduce the need for bailouts, is a cause that conservatives should support," he wrote.

Another conservative Republican, Michael Stafford, championed Glass-Steagall in a call for "progressive conservatism" to make its voice heard after the Republican defeat, published in Arkansas's Baxter Bulletin Nov. 19. "Our political process [has been] captured, by a rent-seeking elite whose only concern is to increase its own take from, and special privileges in, an increasingly rigged and corrupt system;" we need "enhanced regulatory oversight of the financial sector, a return to the Glass-Steagall Act restrictions separating commercial banking and securities trading," he wrote.