Robert Reich: Why Hillary Clinton Is Wrong for Refusing To Resurrect Glass-Steagall

[JRLeft]

Resurrection of the Glass-Steagall Act has become an important policy difference between Hillary Clinton and Bernie Sanders.

BY ROBERT REICH

This post first appeared at RobertReich.org.

Hillary Clinton won’t propose reinstating a bank break-up law known as the Glass-Steagall Act – at least according to Alan Blinder, an economist who has been advising Clinton’s campaign. “You’re not going to see Glass-Steagall,” Blinder said after her economic speech Monday in which she failed to mention it. Blinder said he had spoken to Clinton directly about Glass-Steagall.

This is a big mistake. 

It’s a mistake politically because people who believe Hillary Clinton is still too close to Wall Street will not be reassured by her position on Glass-Steagall. Many will recall that her husband led the way to repealing Glass Steagall in 1999 at the request of the big Wall Street banks.

It’s a big mistake economically because the repeal of Glass-Steagall led directly to the 2008 Wall Street crash, and without it we’re in danger of another one.

Some background: During the Roaring Twenties, so much money could be made by speculating on shares of stock that several big Wall Street banks began selling stock along side their traditional banking services – taking in deposits and making loans.

Some banks went further, lending to pools of speculators that used the money to pump up share prices. The banks sold the shares to their customers, only to have the share prices collapse when the speculators dumped them. 

Read more at the link: http://inthesetimes.com/article/18493/hillary-clinton-bernie-sanders-glass-steagall-wall-street

[mmonk]

1. Recommended.

[JRLeft]

2. This is why Hillary is seen as too close to Wall Street.

[WhaTHellsgoingonhere]

3. Hopefully RR will be a member of Bernie's cabinet

It's starting to feel like people are willing to sell out to elect the first woman.

[JRLeft]

4. I rather wait on Elizabeth Warren.

[Enthusiast]

5. Kicked and recommended a whole bunch!

Thank you, JRLeft.

[JRLeft]

6. If Hillary wasn't such a neo-liberal and a corporatist I could

vote for her, but her stances on some of the more pressing issues are bad. She's still far better than a Republican.

[azmom]

7. K&R

[magical thyme]

8. K&R

But to me it doesn't matter. If she suddenly decides to resurrect it, I won't believe her any way.

She'll do what 3rd wayers have been doing since Bill. Throw a social bone every now and then to pacify one group or another, while continuing to pave the path toward corporate ownership of....everything.

[JRLeft]

9. Pretend to be for and then do little to push when in office.