Dear Commons Community,
Elizabeth Warren dominated a lot of the news yesterday as a potential Democratic presidential nominee. A number of evening talk shows also speculated on her potential candidacy. Today she gave a major speech calling attention to the vulnerability of the American banking system. As reported in The Huffington Post:
“Sen. Elizabeth Warren (D-Mass.) warned in a speech Tuesday that the problem of banks considered “too big to fail” has only gotten worse since the 2008 financial crisis, potentially sowing the seeds of a future crisis.
“Today, the four biggest banks are 30 percent larger than they were five years ago. And the five largest banks now hold more than half of the total banking assets in the country,” Warren said in a keynote address at a conference on the future of financial reform put on by the Roosevelt Institute, a think tank. “Who would have thought five years ago, after we witnessed firsthand the dangers of an overly concentrated financial system, that the ‘too big to fail’ problem would only have gotten worse?”
Warren urged the passage of a new Glass-Steagall Act that would separate commercial and investment banking. The Depression-era legislation was repealed in 1999 with huge bipartisan majorities, allowing depository institutions to undertake riskier securities trading. Warren, along with Sens. John McCain (R-Ariz.) and Maria Cantwell (D-Wash.) have called to revive the legislation, but it stands little chance of passing.
In her speech, Warren urged those who oversee bank rules to set a timeline to address the problem of bank concentration. She has previously shamed bank regulators for their poor performance, asking them in congressional hearings to recount the last time they took a Wall Street bank to trial.”
Although there are almost two years before the presidential nomination process starts, Sen. Warren presents an interesting challenge/alternative to Hilary Clinton.