Glass-Steagall is the indispensable first step to global economic recovery. It will immediately halt the onset of hyperinflation, remove government commitment from bailing out toxic debts, end too-big-to-fail banks, and force a separation of commercial banking functions from investment banking functions.
Legislation to restore Glass-Steagall, “The Return to Prudent Banking Act of 2011”, was introduced into the 112th Congress and garnered massive institutional support and 84 cosponsors in the House of Representatives.
On January 3rd, 2013 “The Return to Prudent Banking” Act was re-introduced by Rep. Marcy Kaptur (D-OH) in the 113th Congress as H.R. 129. And on May 16, 2013 a matching bill was introduced into the Senate by Sen. Tom Harkin (D-IA) as S. 985.
How It Works
Since 1999, banks have been allowed to use commercial deposits and assets as fuel for securities trading on the derivatives market.
Because commercial and speculative assets are so heavily comingled, the government is forced to protect the assets of banks making risky bets through near perpetual bailouts and purchasing of toxic debt.
It was the derivatives bubble that blew up the system and bankrupted the US banks in the 2007-2008 crash.
1. Commercial Banking institutions have one year to divest themselves of all non-commercial banking units, with no cross management or ownership between commercial and non-commercial units.
2. Commercial Banks are barred from using more than 2% of its capital for the creation, sale, or distribution of securities (certain bank-qualified securities are exempted)
3. Prevents Commercial Banks from loaning their commercial deposits into such vehicals as would support the creation and circulation of securities.
4. No securities of low or potentially low value can be placed by a bank into its insured commercial bank units.
* Adds provision stating Glass-Steagall is the preeminant regulator of the banks, limiting banks from putting its depositors and shareholders at risk.
Glass-Steagall forces separation of commercial from investment banks, it ends Too Big To Fail, bars government bailouts, and will stop the onset of hyperinflation.
Click here for marching orders to restore Glass-Steagall.
Spanish anti-bank investigative journalist Josep Manuel Novoa argues the urgency of Glass-Steagall, citing Lyndon LaRouche's campaign to reinstate the FDR law in the United States, in a lively article posted on May 21 by Colectiva Burbuja.
Mexican farmer and peasant organizations are demanding that the federal government immediately make the issue of food production its top priority, or face mass protest and social upheaval from starving citizens.
On May 20 in Sacramento, dairy farmer leaders of California put forward their case that they will go out of operation, if they don't have higher prices, to cover their costs of milk production, which state and Federal authorities have so far refused to act upon, to help.
In the Q&A portion of his testimony before the Joint Economic Committee of Congress on May 22, Federal Reserve Chairman Ben Bernanke, unprompted, raised the issue of Glass-Steagall, in response to a question from Sen. Bernie Sanders (I-VT) about banks that are "Too Big to Fail."
Illustrating how the current and historical fights for the Glass-Steagall principle find resonance in Russia, the May 17 LaRouche Political Action Committee press release on Senator Tom Harkin's introduction of legislation in the U.S. Senate to restore Glass-Steagall banking separation quickly began to be republished after its release in Russian on May 19.
PARIS— Alex Buisson, the leading editorialist of French Morning New York, the largest web magazine for Frenchmen living in the U.S., reported that Cheminade candidate Karel Vereycken, running in the National Assembly elections for the district covering French voters living in the U.S. and Canada, is backing U.S. Sen. Tom Harkin's reintroduction of Glass-Steagall into the Senate.
Under the headline "Harkin Moves to Reinstate Glass-Steagall Act," the Marshalltown Times-Republican, "Central Iowa's Daily Newspaper," today published the following letter by longtime rancher, Dan Schmitt.
Roger Johnson, the President of the National Farmers Union, issued a press release commending Sen. Tom Harkin and Rep. Marcy Kaptur "for introducing legislation to reinstate the Glass-Steagall Act, which would help protect the U.S.
LaRouche Irish Brigade American co-editor and EIR journalist Nina Ogden, and EIR journalist and LPAC organizer Alan Ogden, teamed up with Irish co-editor, Gene Douglas, from mid-April through the first week in May to bring the drive for Glass-Steagall to Ireland.
Reflecting the hope that the British Empire rightly fears could lead to its demise, a couple of new postings on the Harkin introduction of S.985 continue to reflect the new optimism.