That deal had been struck before Glass-Steagall was even repealed in 1998. In reality, Gramm-Leach-Bliley was passed to retroactively legalize the Citigroup merger, which had brought Travelers Insurance, Salomon Smith Barney and Citibank under one roof. Moreover, the creation of “supermarket” financial institutions was needed to keep America competitive with giant “universal” banks in Europe and Asia. The ostensible justification for the repeal of this historically successful reform was that such restraint was no longer necessary. A post-1929 safety measure passed in FDR’s day, Glass-Steagall prevented the mergers of insurance companies, investment banks and commercial banks. The next major move was the Gramm-Leach-Bliley Act, better known as the repeal of the Glass-Steagall Act. Sanders cast the only “no” vote against Riegle-Neal on the House Financial Services Committee. By 2016, Americans had 57 percent fewer FDIC-insured banks than they had in 1994. Signed into law by Bill Clinton, Riegle-Neal helped usher in the era of giant national banks. These rules dated back to the McFadden Act of 1927, passed specifically with the idea of preventing financial concentration. This law torpedoed restrictions on opening bank branches across state lines. The first major move on this front was the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994. Beginning decades ago, the administrations of both Republican and Democratic presidents embarked on a series of policies intentionally designed to consolidate financial power. It’s hard to understate just how much bank concentration has eaten at Sanders over the years. ![]() Morgan Chase, Bank of America, Wells Fargo and Citigroup - are on average 80 percent bigger than they were before we bailed them out. ![]() “Now it turns out that our four largest financial institutions - J.P. “We bailed these banks out ten years ago because they were ‘Too Big To Fail,’” Sanders tells Rolling Stone by phone. It is aimed at the central, still-unaddressed issue of the last disaster: the ungovernable size of the country’s biggest banks.ĭubbed the “Too Big to Fail, Too Big to Exist” act, the Sanders-Sherman bill revolves around a simple concept: If a bank controls assets that collectively represent more than 3 percent of the country’s GDP, or about $584 billion, it has to shrink or be broken up. Brad Sherman (D-CA) introduced new legislation on TARP’s anniversary. The rescue forked over $700 billion of taxpayer money to bail out giant Wall Street banks that were already too big, and were about to get bigger. Bush signed into law the Troubled Asset Relief Program, better known as the TARP bailout.
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