Bernie Sanders Signs 21st Century Glass-Steagall Act of 2015

July 18, 2015

On Thursday, Bernie Sanders (Ind.-VT) became the fifth Senator to sponsor the Glass-Steagall bill, S. 1709, introduced last week by Sens. Elizabeth Warren (D-MA), John McCain (R-AZ), Maria Cantwell (D-WA), and Angus King (Ind.-ME). Sanders' office put out an official announcement on Friday, the day that he was appearing in Iowa with all four other Democratic presidential pre-candidates, including Martin O'Malley, who made Glass-Steagall the main issue of his campaign back in March, and one day before Sanders is scheduled to speak on the podium with O'Malley at the Netroots progressives' conference in Arizona.

In covering Sanders' announcement, Politico reported, “Sanders backs big bank breakups, in contrast with Hillary Clinton,” and referenced the Monday intervention by a LaRouche PAC activist, saying that "a heckler ... challenged her [clinton] to revive the depression-era policy [glass-steagall].”

Sanders' statement says:

“This important piece of legislation would prevent commercial banks from engaging in risky investment schemes that nearly destroyed the economy in 2008,” and stressed his opposition in 1999 to its repeal.

“On July 1, 1999, while Congress was voting on the Gramm-Leach-Bliley Act to permit commercial banks, investment banks, and insurance companies to merge, then-Rep. Sanders said: 'I believe this legislation, in its current form, will do more harm than good. It will lead to fewer banks and financial service providers; increased charges and fees for individual consumers and small businesses; diminished credit for rural America; and taxpayer exposure to potential losses should a financial conglomerate fail. It will lead to more mega-mergers; a small number of corporations dominating the financial service industry; and further concentration of economic power in our country.'

“Looking back today, Sanders said: 'Allowing commercial banks to merge with investment banks and insurance companies in 1999 was a huge mistake. It precipitated the largest taxpayer bailout in the history of the world. It caused millions of Americans to lose their jobs, homes, life savings and ability to send their kids to college. It substantially increased wealth and income inequality and it led to the enormous concentration of economic power in this country.

“Sanders continued: 'I am proud to have led the fight in the House against repealing the Glass-Steagall Act in 1999. Sixteen years ago, I predicted that such a massive deregulation of the financial services industry would seriously harm the economy.... unfortunately what happened seven years ago was even worse than I predicted.'

“Sanders concluded: 'Today, not only must we reinstate this important law, but if we are truly serious about ending too big to fail, we have got to break up the largest financial institutions in this country. If an institution is too big to fail, it is too big to exist.'”