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Warren writes: "We need to learn from the financial crisis of 2008 and, moving forward, to prevent the kinds of high-risk activities that made a few people rich but nearly destroyed our economy."

Senator Elizabeth Warren. (photo: Steve Pope/Getty Images)
Senator Elizabeth Warren. (photo: Steve Pope/Getty Images)


The 21st Century Glass-Steagall Act

By Elizabeth Warren, Elizabeth Warren for Senate

15 July 13

 

hen I learned last winter that I would have a seat on the Senate Banking Committee, I was very happy because I knew it would give me the opportunity to ask tough questions and push for some accountability from Wall Street and its regulators. In the last six months, that's exactly what I've tried to do.

Again and again, I've been making a simple point to anyone who will listen: we need to learn from the financial crisis of 2008 and, moving forward, to prevent the kinds of high-risk activities that made a few people rich but nearly destroyed our economy.

Now it's time to launch the next push. I joined forces with Senators John McCain, Angus King, and Maria Cantwell to introduce the 21st Century Glass-Steagall Act of 2013 to reinstate and modernize core banking protections.

Banking needs to return to the basics. Sign up now to show your support for the 21st Century Glass Steagall Act.

Banking should be boring. Savings accounts, checking accounts -- the things that you and I rely on every day -- should be safe from the sort of high-risk activities that broke our economy.

The way our system works, the FDIC insures our traditional banks to keep your money safe. That way when you want to withdraw money from your checking account, you know the money will be there. That's what keeps our banking system safe and dependable.

But the government should NOT be insuring hedge funds, swaps dealing, and other risky investment banking services. When the same institutions that take huge risks are also the ones that control your savings account, the entire banking system is riskier.

Coming out of the Great Depression, Congress passed the Glass Steagall Act to separate risky investment banking from ordinary commercial banking. And for half a century, the banking system was stable and our middle class grew stronger. As our economy grew, the memory of the regular financial crises we experienced before Glass-Steagall faded away.

But in the 1980s, the federal regulators started reinterpreting the laws to break down the divide between regular banking and Wall Street risk-taking, and in 1999, Congress repealed Glass Steagall altogether. Wall Street had spent 66 years and millions of dollars lobbying for repeal, and, eventually, the big banks won.

Our new 21st Century Glass Steagall Act once again separates traditional banks from riskier financial services. And since banking has become much more complicated since the first bill was written in 1933, we've updated the law to include new activities and leave no room for regulatory interpretations that water down the rules.

The bill will give a five year transition period for financial institutions to split their business practices into distinct entities -- shrinking their size, taking an important step toward ending "Too Big to Fail" once and for all, and minimizing the risk of future bailouts.

This is an important bill that will learn from the 2008 crisis and make sure we hold Wall accountable. Show your support for the new 21st Century Glass Steagall Act now.

When people like you and me work together, we can stand up to even the most powerful interests. That's how we got the Consumer Financial Protection Bureau in 2010. That's how we won our election in 2012. And that's how we'll pass the 21st Century Glass Steagall Act.


 

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+34 # Barbara K 2013-07-15 07:29
You go get them, Senator Warren! It is time someone uses their brains and stop all the BS the banks and Wall St is doing to the rest of us. They should all be locked up. They have even permeated Congress disguised as Republicans. Those are the ones we'll be up against to get this Bill passed. You have my support, Senator, and I hope the support of many more who have been supporting you and encouraging you to do this for us. Thank you.

..
 
 
+22 # tonywicher 2013-07-15 07:32
Hurray! Thank you Elizabeth. Passing and then implementing a strict, ironclad Glass-Steagall law is the only way to turn this country around. We need a real Pecora commission A lot of banksters will go broke and wind up in jail for their chicanery and corruption, as they did in 1933, and that's what has to happen. This time, let's get rid of the private Federal Reserve system completely, and replace it with a federal CREDIT system implemented as a national bank under the control of Congress, as originally intended by the founders of our republic, and implemented by Washington, Hamilton, Madison, Monroe and John Quincy Adams.
http://larouchepac.com/creditsystem
 
 
+24 # fredboy 2013-07-15 07:44
Clinton sold his and the nation's souls when he allowed the repeal of Glass Steagall. He opened the floodgates for the 2003 and 2008 crises and for many crises to come.
 
 
+19 # MidwesTom 2013-07-15 07:45
She is 100% right. We need to severely limit, if not shutdown the shadow banking system. Unfortunately, it probably will not happen as long as we keep re-electing the same Republicans and Democrats 90+% of the time. Look for political rebels like Warren and Paul. They are this country's only hope.
 
 
+18 # jwb110 2013-07-15 07:54
A five year transition period!?!?!? I wouldn't give them five minutes! In that five years they will continue their bad behavior in ever escalating ways.
 
 
-8 # Walter J Smith 2013-07-15 08:01
Re: "The way our system works, the FDIC insures our traditional banks to keep your money safe." Well, it worked like that before Nixon was elected. Since then, less & less so with every administration.

Re: "The bill will give a five year transition period for financial institutions to split their business practices into distinct entities -- shrinking their size, taking an important step toward ending "Too Big to Fail" once and for all, and minimizing the risk of future bailouts."

Five years ago, the Dodd Frank legislation aimed to do something similar. After five years and more bureacratic growth, all that bureaucratice growth has proven to be Wall Street controlled. More Uncle Sam Cancers.

How will you get Wall Street out of the US Government, particularly out of the Treasury, Justice, and other departments where the public decisions would be made public if we had a decent government. Most particularly, how will you get Wall Street out of the US Congress - both houses.

Because as long as you cannot do that, you are, on our behalf, pissing into the wind. The blowback always hits us in the face. It is more rank every time.

No more fantasy propaganda, please.
 
 
+6 # Ken Halt 2013-07-15 15:19
Ya know, ya gotta start somewhere. Being defeatist from the start doesn't accomplish anything. Elizabeth Warren is a very savvy person, has the bona fides to back up her positions, and has a track record of aligning herself with the "common (wo)man". If we don't support those working in our behalf, and there are a few of them in the nation's capital, we surely won't get anywhere. I agree, there is a lot wrong with the US political system. Let's work together and fix it.
 
 
+26 # reiverpacific 2013-07-15 08:22
Sure, of course, "We" (as in those who allegedly represent us) need to learn from the latest GLOBAL financial crisis! Also that wars eventually carry blowback and make no sense in the first place except for a few corporate giants, that a universal health plan is both humanitarian and financially advantageous, that a renewal of a collapsing infrastructure would put millions of people back to work across the board, that the "War on Drugs" is a jokey failure and that Citizen's United is corrupt and illogical but our bought-and-paid for by lobbyists "lawmakers" tend to suffer from wanton, convenient amnesia at the behest of their military-corpor ate-prison-comp lex masters.
One lonely -or even a few like voices- sadly, isn't enough but I'm grateful for Elizabeth Warren for at least trying, using their banker-wanker's lingo against them, to their chagrin and attempted demonization of her efforts.
Would it be possible to get a critical mass behind her, flying in the face of the appalling US owner-media????
 
 
+15 # MainStreetMentor 2013-07-15 09:35
I agree with your stated points, ReiverPacific. It is my contention that Sen. Warren can become, maybe already is, the Senate Rock to which other Senators should tie their anchors. I still believe that a legislative union between Sen. Warren and Senator Sanders would create a strong alliance, with a mission worthy of leading our Congress back to sanity. I agree also, that with a double-handful of Senatorial exceptions, “new” Democratic Senatorial blood needs be introduced via the next three elections. If those new freshman Senators, following the leadership of Warren/Sanders, where the future of America will be determined.
 
 
+19 # ganymede 2013-07-15 08:33
God, what a breath of fresh air! In a couple of paragraphs, Sen Warren explains the exact whys and wherefores of how our corrupted financial system works and what must be done to repair it. Even her birdbrain colleagues are going to have to acknowledge the logic and force of her arguments. Asides from all the obscene amounts of money spent by the neo-fascist Koch Bros, Petersen Institute cronies and all the rightwing think tanks, it's now clear that the biggest culprits are the MSM moguls, and not just Murdoch, who have all refused to explain to the American public what's happening in Washington. Hopefully, Sen Warren and the 1-2 dozen other functioning human beings in Washington will continue to keep up the pressure for serious reform.
 
 
+5 # A_Har 2013-07-15 09:02
Although Senator Warrens ideas are laudable, the horse has already left the barn, and in fact the barn is burning down.

The middle class is being fleeced and gutted. So...these moves while they look good will not stop the next wave of collapse. The banking system is all primed for a crisis worse than 2008 since nothing was fixed.
 
 
+12 # Citizen Mike 2013-07-15 09:48
The reason I called Bill Clinton a Republicrat and distrusted him. He's a tool of the fatcats,and I expect that Hillary is one, too. that is why we must support REAL DEMOCRATS and not fakers like Clinton and Obama who have both betrayed our trust! We must restore what FDR put in place to protect us.
 
 
+10 # Buddha 2013-07-15 10:06
Too true, but how many "real democrats" ARE there in the Democratic Party? And by "real democrats", I am saying those who haven't swallowed the neoliberalism, corporatism, and military-indust rial-complex Kool-Aid. How many wanted "Single-Payer" Medicare-for-Al l to be our Health Care Reform??

Counting Bernie Sanders and Elizabeth Warren, I can probably think of like 3-4 more Dems I'd call anything other than "Republicrats".
 
 
+2 # NOMINAE 2013-07-15 13:29
Quoting Citizen Mike:
The reason I called Bill Clinton a Republicrat and distrusted him. He's a tool of the fatcats,and I expect that Hillary is one, too........


Your suspicions in re: Hillary could not be more well founded.

As a former lawyer (snopes.com) for both Monsanto and WalMart, just to name a few, Hillary has been attached at the hip to the Fat Cats for many decades.

During the Clinton Administration, Hillary used to sail into Black Tie Washington galas on the arm of none of other than Newt Gingrich. All the while excoriating the "vast Rightwing Conspiracy".

Hillary was *totally* accurate in re: the "vast Rightwing Conspiracy" - what she failed to mention, was that in the form
of NAFTA, CAFTA, Welfare "reform", repealing Glass-Steagall,
et al, the Clintons themselves actually *participated in* the "vast Rightwing Conspiracy" against the American form of *regulated* capitalism, and against the American People themselves.

If Hillary ever gets another vote in her life, it will be a "low information vote", and it will be no more reflective of her actual background and qualifications than a vote for American Idol.
 
 
+3 # Citizen Mike 2013-07-15 09:48
The reason I called Bill Clinton a Republicrat and distrusted him. He's a tool of the fatcats,and I expect that Hillary is one, too. that is why we must support REAL DEMOCRATS and not fakers like Clinton and Obama who have both betrayed our trust! We must restore what FDR put in place to protect us.
 
 
+4 # MidwesTom 2013-07-15 13:16
At $500,000 and $350,000 per appearance respectively now, I would classify both Bill and Hillary as Fat Cats. Remember that Hillary was a Senator form NY, and one doesn't get that job without bog time relations with Wall Street.
 
 
+8 # kalpal 2013-07-15 10:25
I firmly believe that the Too Big To Fail Banks and Wall Street will easily devote a billion dollars to obstruct any attempt to hinder them from gambling with OPM. Congress can be bought for that amount, if not far less, quite easily.
 
 
+3 # geraldom 2013-07-15 10:33
I support Sen Warren in her endeavors, but she (unfortunately) has a snowball's chance in hell of winning for the following (current) reasons:

1. She would need both houses of Congress to pass it which, with the legislature's current makeup, will never happen.

2. Non-DINO Dems would have to take majority control in the House & a 60 vote majority in the Senate which will never happen.

3. The reason why #2 above will never ever happen is because of HAVA. HAVA, passed as a Trojan horse by the Repubs & (stupidly) supported by the Dems shortly after the 2000 fiasco, now requires mandatory use of only e-voting machines for all elections, from the federal level to the state & local levels. E-voting machines are designed, manufactured & programmed by private companies who have their own political agenda & who, for the most part, support the Republican Party. These companies claim that the internal software is considered proprietary & therefore cannot be verified by an independent agency for accuracy & honesty. You really have no idea who you're voting for internally.

4. Since the Dems lost big-time in the 2010 midterm elections in many of the so-called critical battleground states, the Repubs have been working overtime with gerrymandering to kick out Dems and put in Repubs.

5. Now that the VRA is dead & buried by Repub judges, the Republican-cont rolled states are now working overtime to massively suppress the minority vote.

I wish Sen Warren luck.
 
 
-9 # FDRva 2013-07-15 10:48
Et tu, Liz?

Your proposed grace period for Wall Street criminals...

...sounds more like a George Soros bailout agenda than FDR's Glass-Steagall.

And I smell Bush money.

Senator Warren would be well advised not to seek higher office--unless her intention is to destroy what little is left of the Democratic Party of FDR.

Sorry, Liz, I am not a Bush Democrat.
 
 
+1 # da gaf 2013-07-15 11:19
the worst President that this country has ever had was without any doubt was GEORGE W.BUSH...EVERYT HING WENT SOUTH WITH HIS TWO ELECTIONS--HE HAS DONE MORE DAMAGE THAN ANY DEMOCRATIC PRESIDENT..SO WHY BRING UP CLINTON AND OBAMA PUT THE BLAME WHERE IT IS DESIRED..IDIOT BUSH JR. TURN EVERYTHING OVER TO THE RICHEST PEOPLE IN AMERICA HIS MOTTO WAS SCREW THE MIDDLE CLASS AND THE POOR. SEE IT AS IT IS..HIS IDIOT WAS RESPONSIBLE FOR TWO ILLEGAL WARS THAT COST THIS COUNTRY ONE TRILLION DOLLARS AND THOUSANDS OF MILITARY DEATHS AND INJURED THOUSANDS OF SOLDIERS FOR LIFE
 
 
+2 # Sweet Pea 2013-07-16 16:42
Sometimes I wonder if Elizabeth Warren is the only sane person left in this government. It seems that many of our congress are hell-bent on making only two classes of people in the country. The rich-and-powerf ul and the poor-and-helple ss.
 
 
+4 # OpportunityForAll 2013-07-17 02:05
"Few men have virtue to withstand the highest bidder." -George Washington

Time to get money out of politics altogether! Sign the petition at MoveToAmend.org NOW, and get on their mailing list! Reform is coming.
 
 
-2 # Hot Doggie 2013-07-18 08:44
Warren is spinning our wheels. Do you really think WTP can benefit from any action where John McCain is part of it? McCain will steer that effort into our oppression. And Warren is trying to get brownie points from WTP. The heck with them both.
 
 
0 # WeMustEvolve 2013-07-18 16:18
We have no choice but to do this reform. Otherwise we are all going to be the victim again of the criminal American Banksters. It's just that simple. I am preparing for the next implosion.
 
 
0 # duitdon 2013-07-28 15:45
We need a new Glass-steagall law even with the help of the likes of McCain. He ain't no statesman but,perhaps Senator Warren may be the first real statesperson since Teddy Kennedy left us.
We haven't had many in the last 50 years but we sure can use one now. How about a shot at her being the next PRESIDENT?
 

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