By now it’s well-established that the 1999 repeal of Glass-Steagall, which was pushed by Republicans but signed into law by President Bill Clinton, played a central role in the 2008 financial collapse. Probably the biggest error in the Dodd-Frank banking-reregulation act is that it didn’t reincarnate Glass-Steagall. Now, a truly biapartisan group of senators has proposed bringing it back.
The co-sponsors include Sens. Marian Cantwell, D-Washington, Angus King, I-Maine and John McCain, R-Arizona, and taking the lead is Sen. Elizabeth Warren, D-Massachusetts. This eminently sensible legislation will once again force banks to be either commercial banks or investment banks but not both.
And it will be fun to see the cries of outrage over this bill from both sides. The Obama Administration quietly opposed a similar measure in 2009 (then sponsored by McCain and Cantwell), wrongly calling it unnecessary.
Will Obama try to block it again? Or will most of the bellyaching come from pandering right-wingers who complain that it amounts to oppressive government regulation, and is “anti-liberty” yada yada yada and blah blah blah?
And which preacher will first bestow to call it “a spawn of Satan?”