Senators Sherrod Brown (D-OH) and Ted Kaufman (D-DE) introduced a bold bill - the SAFE Banking Act (S. 3241) - to break up the big Wall Street banks. This may be the biggest reform of Wall Street and corporate power in 80 years.
Even before the 2008 crisis, the four biggest banks were "too big to fail." Since then, Wells Fargo has grown 43% bigger; JP Morgan Chase has grown 51% bigger; and Bank of America is now 138% bigger than before the crisis. As economist Simon Johnson told Bill Moyers:
The big banks became stronger as a result of the bailout. That may seem extraordinary, but it's really true. They're turning that increased economic clout into more political power. And they're using that political power to go out and take the same sort of risks that got us into disaster in September 2008...
the only thing that has changed is that these banks have gotten larger, more powerful, both economically and politically. And they've been flexing their muscles in Washington for the last year and a half... What Wall Street wants is they want nothing. They want to stop [reform] in its tracks and go back to where we were five years ago.
According to the New York Times, "The [SAFE Banking Act] would reinforce a 1994 law that bars any single bank from holding more than 10% of the nation’s total deposits, or about $750 billion. In the years since then, large firms have obtained waivers or used loopholes in the law to exceed that ceiling." It would also limit total bank borrowing to 2% of GDP.
The bill has broad progressive support, including Dean Baker of the Center for Economic and Policy Research, Chris Hayes of The Nation, Prof. Lawrence Lessig, Heather Booth of Americans for Financial Reform, Adam Quinn of Credo, David Arkush of Public Citizen, and Jan Frel of Alternet.
In addition, three Federal Reserve bank presidents – James Bullard, president and chief executive of the Federal Reserve Bank of St. Louis’ Kansas City Fed President Thomas M. Hoenig, and Dallas Fed President Richard W. Fisher – all support breaking up too-big-to-fail banks.
Senators are getting tons of pressure from the biggest banks to oppose this proposal. We need to show them ordinary people will get their back. Will you help us show this proposal has grassroots support by signing this petition?
America's four largest banks - Citibank, Bank of America, JPMorgan Chase, and WellsFargo - have assets of $7.4 trillion, equal to 52% of our entire GDP.
The collapse of any one would endanger the American economy, even the world economy. They are truly "too big to fail."
They also have too much economic and political power because of their enormous size.
As recently as the mid-1990's, their assets were less than 20% of our GDP.
I urge you to support the Brown-Kaufman SAFE Banking Act (S. 3241) to break up the biggest banks, limit their size, and eliminate the need for massive taxpayer bailouts of greedy Wall Street giants in the future.
Click here to sign.