What is the argument against reinstating Glass-Steagall?

[Kurt_and_Hunter]

I have no set opinion on the matter.

Just wondering what the thinking is in Congress.

_____________________

On Edit:

Consulted the Google oracle. This seems to answer my question... (Pretty good article about the Volker rule versus the McCain-Cantwell Glass-Steagall amendment)

“I think introducing Glass-Steagall now across the board in a weak economy would be counterproductive because you would force sales and the like,” said Representative Barney Frank of Massachusetts, the Democratic chairman of the House Financial Services Committee and a supporter of the president’s plan. “And I think people have exaggerated the importance of Glass-Steagall in this crisis as it wasn’t the main source of problems for Lehman Brothers or A.I.G.”

Mr. Frank told DealBook that the current financial regulatory bill he introduced in the House already had a provision that would give regulators the power to break up banks along the lines of Glass-Steagall if they thought institutions were a major risk to the financial system. The provision was introduced in a contentious amendment submitted by Representative Paul E. Kanjorski, Democrat of Pennsylvania. It was attached to the bill after passing a party-line vote in the House Financial Services Committee, with all the Republicans voting against the provision.

http://dealbook.blogs.nytimes.com/2010/01/22/yearning-for-glass-steagall-on-capitol-hill/

[ananda]

1. Corporations that own the government don't want it.

nt

[Enthusiast]

6. The real answer.

Nothing else needs be said.

[LiberalLoner]

7. Yup n/t

[notesdev]

2. what the thinking is in Congress

"How does this help my re-election chances?"

[ThomWV]

3. It would harm the Banker's ability to earn a decent living

Just like the Supreme Court Decision that put Bush in office. If the recount had proceeded and Gore took the most votes, it would harm Bush's opportunity to become President. Same logic applies in both situations.

[SpiralHawk]

4. "Republicon fat-cat profiteering would suffer." - Rush DraftDodger Limbaugh (R)

"What America really needs is more tax cuts for the rich. Smirk."

- Rush DraftDodger Limbaugh (R)

[Ian David]

5. You can't reinstate Glass-Steagall because Batman rides an elephant.

Also...

[FarCenter]

8. Reinstating Glass Steagall would remove over half of the financial industry from banking regulation

And it was the non-commercial bank institutions that collapsed in the recent crisis.

Investment banks like Bear Stearns, Lehman Brothers; insurers like AIG; commercial lenders like GMAC, CIT; thrifts like IndyMac, WaMu were the ones that collapsed.

Citigroup and Wachovia were the only two large commercial banks to get into trouble.

[Turbineguy]

9. Can you say "Bonus"?

I knew you could.

[wiggs]

10. so why not let it kick in after 5, 8 years? It is a good thing and I understand the

need not to shock the system right now...but it could be set to kick in over time.