Coming Battle for Glass-Steagall in the European Parliament
Two Italian Members of the European Parliament, Marco Zanni and Marco Valli, have filed a list of 101 amendments to the fake EU banking separation bill, which comes up for a vote in the EP Committee on March 23-24. If approved, the amendments would turn the EU regulation into a real Glass-Steagall-like banking reform.
Many amendments just suppress articles of the bill that are useless in a banking separation regime, whereas others change the text drafted by the EU Commission or add new paragraphs to give the bill teeth. Amendment 1, for instance, rejects the proposition that a credit institution must simply "reduce excessive risk exposure," and specifies that this must be achieved "by eliminating the implicit government guarantee enjoyed by trading activities performed by credit institutions." Amendment 2 adds to Art. 1, which calls for "facilitating ordered resolution of crises and recovery," the passage "without repercussions on taxpayers and without implementing a bail-out."
Amendments 4 and 14 change the text proposed by the Commission for "separating certain trading activities," to "separating trading activities from credit activities." Amendment 8 introduces the ban of all trading activities, and Amendment 9 specifies that "credit institutions" cannot perform such activities. Amendment 15 mandates "basic credit institutions" to perform "exclusively" commercial banking. Amendment 16 introduces a whole new paragraph saying that "All activities not indicated in Para. 1 (Art. 8) must be considered as trading activities. Such trading activities are forbidden for basic credit entities" except for a few cases.