Sen. Bernie Sanders (I-Vt.) said today if the Obama administration doesn’t act to break up big banks, he’ll do it himself.
Attorney General Eric Holder told the Senate Banking Committee earlier this month that bringing charges against some banks four years after the financial crisis could bring unacceptable repercussions.
“I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy,” Holder said.
Sanders takes umbrage with the 10 largest banks in the United States being bigger now than before a taxpayer bailout following the 2008 financial crisis.
“In other words,” Sanders said, “we have a situation now where Wall Street banks are not only too big to fail, they are too big to jail. That is unacceptable and that has got to change because America is based on a system of law and justice.”
Sanders’ legislation would give Treasury Secretary Jack Lew 90 days to compile a list of commercial banks, investment banks, hedge funds and insurance companies that he deems too big to fail. The affected financial institutions would include “any entity that has grown so large that its failure would have a catastrophic effect on the stability of either the financial system or the United States economy without substantial government assistance.”
If his bill became law, the Treasury Department would have one year to break up those banks, insurance companies and other financial institutions identified by Lew.
“If an institution is too big to fail, it is too big to exist,” Sanders said. “No single financial institution should be so large that its failure would cause catastrophic risk to millions of American jobs or to our nation’s economic wellbeing. No single financial institution should have holdings so extensive that its failure could send the world economy into crisis.”
“We need to break up these institutions because they have done of the tremendous damage they have done to our economy.”