UPDATE: Please sign onto the SAFE Banking Act: Break Up the Banks Petition here. Many notables have already signed on. Lawrence Lessig, Change Congress (crusader against corruption); Dean Baker; Rob Johnson, Roosevelt Institute; Chris Hayes, The Nation; Nomi Prins; David Cobb, 2004 Green Party; Zephyr Teachout, Fordham law professor; Heather Booth, AFR; Adam Quinn, Credo Wireless; David Arkush, Public Citizen; Jan Frel, Alternet; Dana Balicki, Code Pink; Doug Rushkoff, Life Inc.; McJoan, Daily Kos (Tally of all BUTB supporters here).
Today, someone wrote me, “longest line of shiny limos (awaiting banking lobbyists) outside union station this AM i have ever seen”.
Hidden subsidies, handouts, bailouts, revolving doors, anti-competitive behavior. That’s what a broken political system looks like. Our society has gotten used to this brokenness and corruption because it is legitimated by Congress!
Today, we finally have a bill that we can call our own, will be the biggest reform to big corporations and political corruption in 80 years — Senator Kaufman and Sherrod Brown have introduced the bold “Break Up the Banks” bill that will nip too-big-to-fail in the bud…
… and end the bailouts by breaking up the corrupt big banks we have now.
This is the moment for A New Way Forward. Over a year of work and we may be a part of the slaying of the political corruption that undermines our democracy. The potential for collapse threatens our economy and our democracy. Sign on today, fight concentrated power now. Fighting the big banks is good for the economy, it’s good for job building and it good for our politics. And it’s fun!
Sens. Sherrod Brown (D-Ohio) and Ted Kaufman (D-Del.) plan to file an amendment they say will end banks that become “too big to fail” and prevent future bailouts.
The language, titled the SAFE Banking Act, would limit the size of big financial firms and would ensure that banks have adequate resources to cover losses they incur.
“We can either limit the size and leverage of ‘too big to fail’ financial institutions now, or we will suffer the economic consequences of their potential failure later,” Kaufman said in a joint statement.
Brown added “This bill would not only prevent bailouts and protect against economic collapse, it will help boost lending to small businesses.”
The Ohio senator, who sits on the banking committee, said they would likely offer the language as an amendment to the larger bill between now and next week.
The measure caps the share of one bank’s holding company’s share of U.S. insured deposits at 10 percent and limits the percentage of non-deposit liabilities and leverage limits at all financial institutions.
The language takes on one of the main charges the GOP has lobbed at the bill is that it would allow for future bailouts of large financial firms, primarily through a $50 billion, industry-funded account.
Banking Committee Chairman Chris Dodd (D-Conn.) has said his bill would end bank bailouts and “too big to fail” firms, but Democrats said this was an amendment to reinforce and expand upon provisions regarding the resolution of financial institutions that could fail in the future.
But Brown and Kaufman, who have vocally criticized Wall Street firms, said that the effort is not a response to Republican complaints, but are part of a long-standing effort to ensure that large financial firms do not believe they will receive government assistance again.
“Absolutely not, this is something we have been working on for some time,” Brown said on a conference call with reporters when asked if it was a response to Republicans, calling their claims a “smokecscreen.”