General Discussion

Eric J in MN

(35,619 posts) Thu Oct 1, 2015, 06:59 PM Oct 2015

Bernie Sanders and Robert Reich agree about bank policy

Robert Reich was Bill Clinton's Labor Secretary. He was recently a guest on the radio show, "Democracy Now."

Robert Reich and Bernie Sanders both want the US to restore Glass-Steagall and break up the biggest banks.

"Democracy Now" with Amy Goodman played a clip of Sanders:

When I was in the House, I was a member of the House Financial Services Committee, that dealt with deregulation. And we had the Clinton people, and we had the Republicans coming before us. And remember what they said? They said, "It’s a great idea if we merge investor banks—investment banks with commercial banks, with large insurance companies. It will be great for us internationally." I never believed it for one second, fought against it.

So, to my mind, what we have to do is, A) re-establish Glass-Steagall, maintain those separate entities, but second of all, more importantly, we have got to break them up.

Then host Amy Goodman asked Robert Reich, Bill Clinton's Labor Secretary, to respond.

AMY GOODMAN: That’s Bernie Sanders. Actually, Glass-Steagall was repealed under the Clinton administration in 1999, Robert Reich.

ROBERT REICH: Bernie Sanders is right: We’ve got to re-establish Glass-Steagall. Repealing it—

AMY GOODMAN: And explain why it’s so important.

ROBERT REICH: Well, because after the crash of 1929, the United States set out to prevent that kind of crazy risk taking by the banking sector that led to the crash of 1929—we’re not talking about 2008, we’re talking about 1929. One thing we did was separate commercial banking from investment banking, so that people’s deposits, the ordinary savings of ordinary people, would not be used for gambling operations by the investment banks. We ought to maintain that. I mean, that’s one of the reasons that we got into trouble again.

We also need to bust up the biggest banks.