Break Up the Banks

Our finance industry is on the attack again. The industry target now is the Volcker rule -- the proposed rule that would limit the ability of banks to trade for their own account. Leading the attack has been JPMorgan CEO Jamie Dimon.

The Wall Street bill has much to be said for it, but the unfortunate truth is that it ducks several of the most critical reforms needed to protect our economy from banker abuse.

No matter what else is ultimately enacted in the name of Wall Street reform, Congress decided last night that it will not confront the single greatest problem in the U.S. economy: Too Big To Fail.

With two-thirds of the nation supporting reform, any political party that throws in its lot with Wall Street will pay a major price come November. No amount of Wall Street campaign cash can counter voter outrage.

Breaking up the banks does not guarantee good regulation. However, a break-up of the big banks will at least give the country some hope that things can change.

The only way to make sure no bank it 'too big to fail' is to make sure no bank is too big. If our current leaders fail to do this, you have every reason to believe it's because Wall Street has paid them not to.

Thursday night's passage of Wall Street reform is an event to be celebrated, but several key issues remain in play as the House and Senate iron out differences between their respective versions of the legislation.

Although the defeat of Brown-Kaufman was crushing, it was nonetheless an indicator of the strength of the populist call to break up the banks and reduce Wall Street power.

Seen in an abstract light, we can have no assurance that any new regulations will actually work to prevent a financial crisis or defuse one, so the safer option is to break up the big banks.

There is a movement afoot, and I'd like you to join us. Several organizations are cooking up a number of ways to make this change happen.

With the DNA of two Nobel Laureate economists in his genome, one might think Summers would have the best grasp of how to fix the broken financial system. One would be wrong.

It is not that the big banks themselves are "too big to fail." They are too big because they can cause all of us to fail.