Liam Halligan: “Over In America The Glass-Steagall Debate Is Live”

2 June (LPAC) In a June 1 article in the Daily Telegraph headlined, “Lack of genuine reform is sowing seeds of next crisis,” Halligan — who has repeatedly pushed Glass-Steagall — reported on the fact that “draft legislation to restore Glass-Steagall has just been introduced in the U.S. Senate. This is a companion bill to a measure in the House of Representatives that now has 63 sponsors. Over in America, the Glass-Steagall debate is live.” Halligan not only reports on this key development, which most major media have studiously blacked out, but he again comes out swinging for the needed policy shift, noting that “in the U.S., the debate on Glass-Steagall is now shifting,” and that voices in the UK also need to speak out, “and soon..”

“For many years, this column has banged the drum for the U.S. in particular, but also the UK and Western Europe, to re-impose a decisive split between commercial banks (that take deposits and lend to ordinary firms and households) and investment banks (which take big risks)…

“Those of us who called for a new Glass-Steagall back in the immediate aftermath of the sub-prime crisis were often derided. Yet numerous very serious people have emerged as strong supporters of this view. Outgoing Bank of England Governor, Sir Mervyn King, backs re-imposing a genuine divide. So does former Federal Reserve boss Paul Volcker and former UK chancellor Lord Lawson. Even John Reed and Sandy Weill, the two Wall Street plutocrats who made vast fortunes off the back of the Clinton-era repeal, now admit that dismantling Glass-Steagall was wrong…

“Sick of market instability, America’s mighty farming lobby last week called for a new Glass-Steagall. ‘Congress must learn from the past in order to prevent future financial crises,’ said Roger Johnson, president of the U.S. National Farmers Union. We’ve also lately had a courageous set of statements from an economist called Jeff Sachs…

“So, in the U.S., the debate on Glass-Steagall is now shifting. Here in the UK, our ‘Vickers reforms’ … are a deeply inadequate response to our current predicament. While some UK authority figures have spoken out, I know for a fact that there are many, many more. They need to find their voice — and soon.”

(Links added–ed.)

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