Barney Lied: He DID Support the Repeal of Glass-Steagall

Rep. Barney Frank strongly supported legislation to repeal the 1933 Glass-Steagall law, contrary to the false impression he gave in his June 13 debate with Rachel Brown, when he claimed that "I voted against the repeal of Glass-Steagall."

Frank explicitly supported the provisions of the 1999 bill which repealed Glass-Steagall, praising the portions of the Gramm-Leach-Bliley Act which allowed the merger of investment and commercial banking. Speaking on the floor of the House on July 1, 1999, during the debate on H.R. 10 (then known in the House as the "Leach bill"), Frank explained that he was only voting against the bill because of its failure to strengthen the Community Reinvestment Act, the anti-redlining law which required banks to invest in low-income communities.

But "on the subjects that it deals with it does a good job," Frank said. "It is a good piece of legislation for setting forth the conditions for the financial services industry, central to capitalism," Frank stated. "It is a good situation in which the intermediation function of the financial services industry can go forward" — using the codewords for the tools of the speculators such as hedge funds and derivatives.

"We go forward and we provide the conditions and improve the conditions for wealth to be generated, and I am for that," Frank continued, adding that "I would vote for this bill if we were talking simply about these conditions and no other were relevant," but explaining that he cannot vote for this bill "while at the same time we refuse to address the serious problem of poverty in the inner cities." (emphasis added)

Referring to the "tragedy of this bill," Frank declared: "It is a good bill in what it does, but it is a bad bill in what it does not do." He congratulated those who had worked up "the banking provisions that deal specifically with financial services."

The final proof—were more needed—is that despite the fact that Barney voted against the overall bill, he was appointed to the House-Senate conference committee to work out the differences between the House and Senate versions. Frank was appointed specifically for consideration of Titles I of both the House and Senate bills—the sections repealing Glass-Steagall—hardly a position he would had been given had he opposed repeal!

When the House voted on Nov. 4, 1999 on the final bill (S. 900) as embodied in the Conference Report, Barney repeated his support for the provisions repealing Glass-Steagall. Calling it "half a bill" for what it did not do, Barney lavishly praised what the bill DID do. "It does a very good job of creating the conditions in which the capitalist institutions can flourish, and that is a good thing," Frank gushed. "We want capital to move freely. We give the financial institutions everything they have asked for." (emphasis added)

Which Barney has continued to do, to this day.