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Friday, September 30, 2016

Elizabeth Warren Asks Treasury Secretary Jack Lew If He’d Support Letting The Biggest Banks Get Even Bigger

Senator Elizabeth Warren (D-MA) wants answers.

After the financial crisis, the Senate considered legislation from senators Sherrod Brown (D-OH) and Ted Kaufman (D-DE) that would have broken up the nation’s biggest banks. The Treasury Department didn’t support the law and it failed.

Now, Warren says that big banks are larger than they were before they needed to be bailed out.

“How big do the biggest banks have to get before we consider breaking them up?” Warren asked newly appointed Treasury Secretary Jack Lew last week. “They’re 30 percent bigger now than they were five years ago. Do they have to double in size, triple in size, quadruple in size before we talk about breaking up the biggest financial institutions?”

Lew said that his policy was to end “too big to fail” and that he would not advise that until the Dodd-Frank financial reforms are fully in place.

Most Americans aren’t aware that the Obama administration opposed breaking up the big banks. In 2010, as the debate over financial reform raged, the Tea Party movement was acting as if regulation and high taxes had created the crisis, despite both at or near half-century lows. And while Brown and Kaufman were fighting to restrain the banks, Elizabeth Warren hadn’t yet made it to the floor of the Senate or the Senate Banking Committee.

And now you can see why the banks never wanted her to get there at all.

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  • This reminds me of the days when our government, correctly, identified the dangers of a single company dominating a market sector and influenced the breakup of AT&T to encourage competition and progress. We don’t need super-banks whose only focus is on profit and risk our hard earned money to grow. We need banks that remember that the reason for their existence is to protect the funds of their depositors rather than gamble with them.
    The good news is that, according to the Federal Deposit Insurance Corp., only 51 banks failed in 2012. That is less than 1% of all FDIC-insured institutions, and a significant improvement over what was happening in 2008 and during the S&L debacle in the 1980s.

  • 788eddie

    So far, I have been impressed with Elizabeth Warren every time I have heard her speak. She speaks clearly, she thinks out her ideas, and she does not let people she questions get “off the hook.” We need more people like her in the government.

    She’s the kind of person who could make “the special interests” tremble.

    The more people hear her, I think the more people will like her. Is she being considered for higher office?

    • I agree. I think she is going to be a formidable candidate for President in 2016.

      • Allan Richardson

        I am not sure if she wants it, or is ready for it, or could get past the primary vs. Hillary, or get past the Republican money influence. But IF it happened, and if the current Queen is still healthy and not abdicated, it would be the FIRST time since 1797 (George Washington and George III) that our President and Britain’s monarch have the same first name, Elizabeth!

  • howa4x

    We still live in a dangerous time with the banking that are too big to fail. Just last year JP Morgan/chase lost 7 billion on a bet in Europe. This is how risky the banks are. If the bet was bigger it might have pulled them under. Then what? Banks don’t like Dodd/Frank because of the living will they had to file on how the assets of the bank would be distributed. The also don’t like the fact that they have to keep a percentage of funds on hand and not gamble with it. They are way too big and easily can be broken up. Now we need to see if anyone has the courage

  • Mark Forsyth

    I watched Warrens questioning of Lew and that goddamned son of a bitch refused to give her a straight answer.I would favor seeing that fancy dancer get a swift kick in the face.Big corporations have been trying to sidestep the anti-monopoly and anti-trust laws since they were enacted. I say God Bless Elizabeth Warren and her work.May it be the beginning of the end of financial fraud.As to the question of how much bigger-not one red cent.

  • DoroJim

    If the banking industry wants to keep skin in the game, they need to present a plan that is acceptable to all interested parties.

    If they don’t, Senator Warren will continue to eat their lunch at every encounter.

    They are in the minority. It is time for them to put up, or shut up. Nobody wants the banks to become “Nationalized.”

    However, we cannot wait until another “SHOCK” hits the system. The best time to deal with a problem is BEFORE it becomes a problem.

    That may not be possible in many cases. This is not one of those cases.

    Everyone knows the banking industry WILL have another crisis. The only question is, will it be confined to a few SMALLER entities, or will it finally cripple our whole Nation?

  • demhack

    4 Senators in the hearing, there was no bipartisan agreement and Warren keeps the story telling. I’m surprised she didn’t contend that she was a member of the Oklahoma Indian tribes

  • RobertCHastings

    Somebody a few weeks ago advocated drafting her in 2016 (me). You guys were right, we need her more right where she is. I just hope that some of her colleagues get off their well-healed asses and join with her in putting this country’s financial system on a sound footing.