Executive Intelligence Review
Subscribe to EIR


Momentum for Glass-Steagall
In the United States

May 5, 2010 (EIRNS)—Sen. Marie Cantwell (D-Wash.) and five other Senators are co-sponsors of S.2886, the Banking Integrity Act of 2009 (filed December 2009), which calls for the restoration of the 1933 Glass-Steagall law, and which, so far, has been sidelined by the White House and Congressional thugs, in favor of the fake "financial reform" bill, led by Sen. Chris Dodd (D-Conn.). However, more and more attention is focussing on the Glass-Steagall principle, given the combined effect of the LaRouche movement, public wrath over revelations about the role of Goldman Sachs and other financial firms that were bailed out by the George W. Bush and Obama administrations, during the breakdown crisis. Even while the Dodd bill begins to be debated on the Senate floor, dozens of potential amendments are being advocated, as the financial blowout continues.

On April 22, Cantwell said in a speech on the Senate floor:

My constituents have been so disgusted by our lack of holding Wall Street accountable. They have said, If you can't beat them, then at least break them up. So, Madam President, I will be offering an amendment to return us to Glass-Steagall, the law of the land previous to 2000, to help protect consumers for decades.

Otherwise, the amendments run the gamut of loony to evil. Some, however, have the Administration already in a panic—including the bill introduced by Sen. Bernie Sanders (I-Vt.), which calls for a mandatory audit of the Federal Reserve. Both Bernanke and the White House are lobbying aggressively to try to stop this bill, which appears to have the votes to pass—as it has done in the House. Even those who oppose restoring Glass-Steagall, like Sen. Mark Warner (D-Va.), have opined that restoration may have the votes to pass in the Senate.

This just underscores the question: Why not Glass-Steagall now? Sen. Ted Kaufman (D-Del.), a co-sponsor of the Cantwell bill, raised this May 4 at the Senate Judiciary Committee hearing, "Wall Street Fraud and Fiduciary Duties: Can Jail Time Serve as an Adequate Deterrent for Willful Violations?"

"Bring back Glass-Steagall" is the message of South Carolina Law School Prof. William Quirk, who is speaking out. In an interview in the CorporateCrimeReporter.com, Quirk states that "Glass Steagall limited size by limiting function.... You would have to reinstate Glass-Steagall. And you would have to break up the five biggest banks. Everybody knows that if Goldman has trouble tomorrow, the government will bail them out again...."

In Connecticut, Dodd's home state, an opinion column ran May 4 in the New Bedford Paper, SouthCoast, titled, "Shortening the Reigns on Wall Street." It stated:

As the Senate considers amendments to the financial reform bill this week, Americans will hear plenty about what the bill does not do. It does not break up so-called 'too big to fail' banks, nor does it restore the Glass-Steagall Act, which once separated commercial banking from investment banking. Criticism comes from both sides. For example, while it's mainly Democrats who say the bill doesn't go far enough, Sen. John McCain proposed reinstating Glass-Steagall last year....