Exclusive: Sanders Tackles Too Big To Fail In Two Pages

Senator Bernie Sanders (I-VT) introduced new legislation on Friday that should, he claims, solve the phenomenon of massive and failing financial institutions holding the nation's economy captive.

It's all of two pages long.

The Vermont Democrat-Socialist unveiled the "Too Big to Fail, Too Big to Exist Act" -- which he billed as a succinct remedy for tackling financial risk and avoiding a repeat of the taxpayer-funded bailouts that occurred just one year ago.

The act is straightforward. It would require that 90 days after its passage, Treasury Secretary Tim Geithner "submit to Congress a list of all commercial banks, investment banks, hedge funds and insurance companies that the Secretary believes are too big to fail."

Subsequently, one year after the law is enacted, the Treasury Secretary would be required to "break up entities included on the Too Big To Fail List, so that their failure would no longer cause a catastrophic effect on the United States or global economy without a taxpayer bailout."

The rest of the details -- like, say, how to do that, how the broken-up entities would be structured, and what authorities would be granted for preempting institutions from becoming too big to fail in the first place -- would be filled in during the legislative process, Sanders's office said. The goal is simply to immediately preempt a duplication of last year's economic meltdown.

"Here is an example of amazing irony," the senator said in a video shot by Brave New Films accompanying the legislation's release. "Three out of the four largest financial institutions in the country who led us to this financial disaster are now bigger then they were before the collapse. So we have got to break these guys up so we don't see a recurrence of what we saw a year ago."

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The brevity of the Sanders bill is, in some ways, its selling point. The Senator notes in the video that, "unlike the health care bill, which is 1,990 pages, this is all of two pages." An easier contrast, however, is between the senator's efforts to tackle Too Big To Fail and those being pursued by others in Congress and the White House.

Last week, Geithner, in cahoots with House Financial Services Committee Chair Barney Frank, released a proposal to not only structure a new system for bailing out failing institutions but also for improved regulations over those institutions. Clocking in at 253 pages, the plan would empower regulators to essentially shut down banks or firms that threatened the stability of the economy. Should a bailout be necessary, other financial firms and not the taxpayers would have to front the bill.

READ THE SANDERS BILL:

tbtf -

Comments

[vinny]

"banks, hedge funds, insurance companies that the Secretary believes are too big to fail"

this is the only problem with the plan... don't trust geithner with any decisions...

[Labsaregreat]

JUst get rid of FDIC Insurance....

[americansfordecency]

The only socialist in the congress and one of the best and most honest.

[talkitreal]

The idea is smart, but the details matter Sanders -- You should already know that!

[Wide Stance]

I love it. Great job, Bernie, VT natives everywhere are proud!

"Too big to fail"? Too big to exist.

Something has to be done because these firms are just a big bag of failure--and they will keep failing and Republicans will keep getting rich off that failure.

[Tahut]

I want him to represent me in Congress. Perhaps we need to have the government put more federal tax dollars into cloning technology. And Grayson too! And I wouldn't mind if they made the balls a little bigger and hairy - the more the better.

[jinxed]

Don't forget Dennis Kucinch

[polishlogician]

see if everyone just widened the margins and changed the font, we could shorten or lengthen any bill...when did a bill get so identified with its number of pages, like a wannna-be celeb, with their age, in People magazine...

[gurukalehuru]

There is a rather large difference between 2 and 1,900, but you already knew that, didn't you?

[jonahbasset]

LuvMeSumBernie ♥

[ECJLA]

There are two other institutions that are "too big to fail" and that are obstructing progress not only on financial reform but the corollary cause of stopping (cold) the expansion of extreme inequality, which is the 21st century moral equivalent to halting the spread of slavery in the 19th. I refer to the Democratic and Republican parties.

Democratic presidents from FDR through LBJ enforced the antitrust laws (as did Eisenhower). But the Democratic party that nominated FDR in '32 (and McGovern in '72 -- that many of us came of age in) now exists only in nostalgia.

Restive members of the base of both mainstream parties are on the verge of bolting and forming two vibrant (albeit bitterly antagonistic) new political parties run by militants for their (leftist and rightist) worldviews. The country will be (much) better for such ardent, honest philosophical and policy competition.

A new left-liberal party could and should put forth a fighting enlightenment platform, run a presidential candidate on it, win a general election, and use the resulting mandate to implement it. This could be accomplished within two election cycles of its founding, as it did with the Republicans (1856 and 1860).

Without such a sea change this well-intentioned new bill and others like it (in particular) and "we the people" (in general) will continue going nowhere fast.

Eric C. Jacobson
Public Interest Lawyer
Culver City, California

[research]

The progressive caucus, the people like Kucinich are just the FDR democrats we need.

It's the DLC corporatist funded DINO's that ar the problem. Lieberman, Clintons, Rahm and even Obama, though I still hope he can escape his past.

The Voters need to learn to vote for the candidate with the LEAST money.

[ECJLA]

Research:

As Lee Stranahan discusses in today's HuffPost, Kucinich has been marginalized.
Why? Because the Democratic Party is now a wholly owned subsidiary of wealthy elites who in turn have too much to lose to advance the general welfare (aka the common good). On scrutiny, literally everything they do is geared toward helping those elites enhance their class privileges (reverse Robin Hood style) at the expense of the well being of the lower-middle class and poor. (The Republicans do this on steroids.)

Hence we see health insurance "reform" whose only tangible benefit is to eventually enable those with pre-existing conditions -- who can already afford to join Kaiser or other expensive plans -- to do so.

The issue is: how much more of the mainstream Dems' dithering, imbecility, kowtowing to the rich (the political equivalent of domestic abuse) are the good everyday people of the country going to take before divorcing the Democratic Party and forming their own social democratic party that is serious about governing in the public interest. A party that does not deem "the art of the possible" constricted by prevailing oppressive conditions but rather sees those conditions as the basis for a revolt and creation of a new, far more just and reasonable social and economic contract.

American rightist-c­onservativ­es are already voting with their feet to leave the Republican Party (an already super-conservative institution). Left-liberals' principled differences with today's lackey Democratic leaders are even more irreconcilable.

We shall overcome.

Eric

[LebronJeremy]

The "capitalists" will cry over this. But if a corporation is too big to fail than the market isn't free. Too big to fail implies that a monopoly is at the heart. And the market isn't free with the existence of monopolies.

[DiogenesOfAlaska]

Cool. But something tells me that in the end, the legislation will be closer to those 253 pages in length. Still, it's a nice innovation. :-)

[Tahut]

At the very least, anything over the originsl 2 pages has to be attributed to some other j.e.r.k. looking to defuse the bill for the sole purpose of protecting the industry, not in the best interest of his or her constituents.

[metogamekun]

I love this guy. Can we adopt him?

[schatsie]

You can donate to him.

[Polly]

As always you use common sense to make positive change for America - Thank You Senator!

[msjimmied]

Focus on this one too...

http://www.zerohedge.com/article/%E2%80%9C-chief-executive-giant-dark-pool-said-amount-money-devoted-high-frequency-trading-could-%E2%80%98qu

[HalR]

Bernie Sanders shows what Logic and common sense can do for writing a bill. As most Senators have been bought out by lobbyists and G. Bush's have mores. Keep up the good work Sen. Sanders, thanks.

[Tahut]

He's proof that government isn't as complicated as what the rest of the Congress critters go out of their way to make it look like it is.

[3blueeggs]

I think Senator Sanders is GRRRRRRRRR­RRRRRRRRRE­AT!