Bi-Partisan Bill to crack down on Too Big To Fail
Senators Sherrod Brown (D—Ohio) and David Vitter (R—Louisiana) are cosponsoring a bill that would require stricter capital requirements on the six largest megabanks. These six banks — which all have more than $500 billion in assets — are JPMorgan Chase; Citigroup; Goldman Sachs; Morgan Stanley; Bank of America, and Wells Fargo.
Instead of breaking up these megabanks into smaller banks, this bill would require the banks to finance at least fifteen percent of their investments with equity. This would hopefully make them less likely to become insolvent and require another trillion-dollar taxpayer bailout.
In addition to preventing another 2008-style crash, this bill would dilute some of the largest banks’ political clout. Sherrod Brown said:
“These six banks are from $600 billion to $2.2 or $2.3 trillion in assets, and you know it’s really … way more than the economic power these six banks have. It’s also the political power they have. The power to slow down the rules coming out of Dodd-Frank. If we do nothing here and things continue — these six banks will have 65 then 70, who knows what percent of GDP their assets will represent. Their political power and their economic power go together.”
And as long as we’re cracking down on Wall Street — or daydreaming about it anyway — the Securities and Exchange Commission (SEC) might start requiring all publicly traded companies to disclose all political contributions to their shareholders. Imagine that: hundreds of millions of dollars in secret anonymous contributions, suddenly on public display.
Needless to say, congressional Republicans are scared shitless of having their secret donors dragged out from under their rocks and into the sunlight. Also needless to say, they’ll pull every possible stunt and parliamentary maneuver to keep the lowly public from ever finding out who owns which candidate.