Glass-Steagall to be at Forefront of New York Primary Fight
April 13, 2016 (EIRNS)—The fight over the need to reinstitute FDR’s Glass-Steagall, in order to rein in Wall Street, has come to the fore in the run-up to the April 19 New York Democratic primary, as attested by two recent developments. The first was the initiation on the New York City radio station WNYC on April 11, of a series entitled “Break Up the Too-Big-To-Fail Banks Now—or not?” The first segment, in which host Brian Lehrer interviewed New York Times financial columnist Gretchen Morgenson, was devoted to Glass-Steagall historically, and Morgenson’s assertion that keeping the banking separation it mandated in place would indeed have made some of the major risky abuses of the 2007-08 crises impossible. Lehrer plans to continue the series over the week, when both Hillary Clinton and Bernie Sanders will be campaigning in New [York, including an April 14 candidates’ debate.
The second development was the introduction this week into the New York State Assembly of Bill K01192, a resolution calling on the legislature to convey to Congress its support for reinstatement of Glass-Steagall. The resolution, introduced by Schenectady Assemblyman Phil Steck, has 26 co-sponsors.
While New York City is an epicenter for the debate—being the home of Wall Street and LaRouche PAC’s high-profile campaign in the area through the Manhattan Project—the upsurge in activity around Glass-Steagall is national and international in scope. On April 11, the PBS New Hour devoted a segment to a critique of Dodd-Frank, in which a member of the U.S. Treasury’s Financial Research Advisory Committee, Lynn Stout, called for revival of the rules in place before 1999-2000, including Glass-Steagall. On April 12, the London Guardian ran an op-ed by Asher Edelman, the purported model for the Gordon Gekko character in the film “Wall Street,” saying he fears a depression and supports Sanders because only he would break up the banks. There is also an active fight in the Italian parliament on the issue, with 12 bills introduced.
Sanders is a co-sponsor on the current Senate bill S. 1709, which would reinstate Glass-Steagall. Clinton has explicitly opposed reinstatement, as has the Republican Party generally. Indeed, Glass-Steagall killer Phil Gramm is a key adviser to the Ted Cruz campaign. The House bill to reinstate Glass-Steagall (HR 381) has 73 sponsors, and so far cannot get a hearing.