Tuesday, August 2, 2016

21st Century Glass-Steagall Act

In 1999, when Congress repealed core provisions of the Glass–Steagall Act, it provided an opportunity for traditional banks to engage in an array of high-risk activities. And that is exactly what they did—growing in size and adding activities to their portfolio that threaten our country’s financial security.

A 21st century Glass–Steagall—which has been introduced by Sen. Elizabeth Warren and has bipartisan support—would separate traditional banking activities such as savings and checking accounts from riskier financial services such as hedge fund and private equity activities, investment banking, and more.

Please stand with the EPI Policy Center and our partners in calling on Congress to pass Sen. Elizabeth Warren’s 21st Century Glass–Steagall Act and begin to rein in Wall Street’s greedy and reckless behavior.

 
Glass–Steagall was originally passed in 1933 in response to the 1929 financial crash. It created a wall between traditional depository banks and investment banking. But by removing that wall, Congress effectively put the American people on the hook to bail out all banking activities—allowing Wall Street to gamble not with their own money, but essentially with taxpayer money.
 
The recent Democratic and Republican party platforms call for reinstating the Glass–Steagall Act. This could be a rare opportunity for bipartisan agreement within a deeply divided Congress.
 
Please, join us in calling on Congress to pass Sen. Elizabeth Warren’s 21st Century Glass–Steagall Act to separate traditional banking from risky activities and to protect the American public from potential future financial crises.
 
Thank you,
Josh Bivens
Research and Policy Director, EPI Policy Center

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