Elizabeth Warren Challenges Obama to Break up Too-Big-to-Fail Banks

Search form

Elizabeth Warren Challenges Obama to Break up Too-Big-to-Fail Banks

Elizabeth Warren Challenges Obama to Break up Too-Big-to-Fail Banks
Thu, 11/14/2013 - by Dan Roberts
This article originally appeared on The Guardian

Senator Elizabeth Warren cemented her growing reputation as a darling of the political left on Tuesday with a wide-ranging speech challenging the Obama administration to take on Wall Street and break up its biggest banks.

Amid renewed speculation that she might challenge Hillary Clinton for the 2016 Democratic nomination, Warren appeared at a congressional event to attack regulators for failing to tackle the problem of financial institutions that are "too big to fail".

"We have got to get back to running this country for American families, not for its largest financial institutions," said Warren, who said the issue was an indictment of how little had changed since the 2008 banking crash.

The four biggest Wall Street banks are 30% larger than before the financial crisis, she said, while the five biggest institutions hold more than half the bank assets in the country.

Warren claimed this amounted to an $83bn-a-year taxpayer subsidy for some Wall Street institutions, because they were so large that they could safely rely on a government bailout in the event of a future crisis, and were therefore able to take bigger risks than rivals. She also cited research suggesting the crash had cost up to $14tn, or $120,000 for each American household.

The first-term senator from Massachusetts, who led the congressional taskforce overseeing the bank bailout, has repeatedly denied she has presidential ambitions, but growing talk of her potential candidacy has ensured that even is she doesn't run, she will act as a counter-weight to Wall Street financial backing for Clinton.

In her speech to the Roosevelt Institute and Americans for Financial Reform, Warren did not mention wider political ambitions but focused on proposed legislation launched over the summer with Republican John McCain to break up large banks and build on the 2010 Dodd-Frank reforms.

"Where are we in making sure behemoth institutions on Wall Street can't bring down the economy again? And make wild gambles that suck up all the profits in the good times? And stick the taxpayer with the bill when it goes wrong?" she demanded.

"Three years since Dodd-Frank was passed, the biggest banks are bigger than ever, the risks to the system have grown and the market distortions continue."

She said current regulators do not give "much reason for confidence" and added: "It is time to act: the last thing we should do is wait for another crisis."

Warren's remarks came as the White House confirmed that a relatively unknown Treasury official Timothy Massad would replace former Goldman Sachs banker Gary Gensler as chair of Wall Street derivatives regulator, the Commodities and Futures Trading Commission.

Announcing the appointment, President Obama defended what he called "historic Wall Streets reforms" that had already "put in place smarter, tougher common sense rules of the road."

 

"The markets have hit record highs and there is no doubt our financial system is more stable," said Obama.

"Tim's a guy that doesn't seek the spotlight," he added.

Originally published by The Guardian

Article Tabs

In times of crisis, the term “protect the women and children” might still come to mind.

The nation's richest family is funding nearly two dozen organizations working to roll back renewable energy policies, while pushing for regulations aimed at hindering the growth of rooftop solar power.

Out of her $672 monthly disability check, Rochelle McCaskill spends $600 rent – leaving her unable to pay the city’s water bills, which have skyrocketed to more than twice the national average.

This isn't just a right to revolt, it's a call to revolt, an outright slam against apathy and nonresistance.

Inequality is all anybody can talk about, except Democrats on the campaign trail who desperately need to turn out the very people so disproportionately affected by it: young and minority voters.

“We wanted to take action to dramatize the betrayal of the American people and show that we will resist and attempt to disrupt or at least expose pro-corruption politicians' ability to raise big money.”

Posted 5 days 7 hours ago

After 13 years of militarized zealotry and fear-mongering in the name of fighting terrorism, Risen's new book, "Pay Any Price: Greed, Power, and Endless War," unveils difficult post-9/11 truths.

Posted 6 days 7 hours ago

The oil giant, with $21.4 billion in 2013 revenue, is trying to buy upcoming municipal elections in Richmond that pit a pro-Chevron bloc of city council members against an anti-Chevron bloc.

Posted 6 days 6 hours ago

The Seattle festival showcases bold visions on the screen, with 50 films challenging societal structures through creative perspectives and a critical eye.

Posted 6 days 6 hours ago

Drug and device makers paid doctors $380 million in speaking and consulting fees over a five-month period last year – and saw a healthy return on their investment.

Posted 4 days 6 hours ago

In this second of a two-part series on the TRADOC workers' cooperative in Mexico, worker-owners have been building tires since 2005 — selling them in the U.S. and Mexico and now paying themselves the highest wage in the tire industry.

A plan to massively tax oil companies drilling in Denmark's North Sea has caused some global firms to threaten to take business elsewhere. Meanwhile, Denmark stands to win big, using the funds to build a new, clean, $5.2 billion high-speed rail system.

If the story of a human future is not green, there is no future. If we can restructure our world along new understandings of ecology and economics, there is a chance we can salvage something.

Occupy Sandy Emerges as a Relief Organization for 21st Century

As local leaders and citizens complain of FEMA, the Red Cross and government absences in their neighborhoods, Occupy Sandy has been organizing actual, tangible responses.

The Golden State can lead others down the path of debt peonage and keep paying for Wall Street's blunders – or we can be a model for establishing state economic sovereignty.

Sign Up