Bernie Sanders Admits He Isn’t Sure How to Break Up Big Banks
– Vanity Fair
“Vermont senator Bernie Sanders has made railing against inequality, Wall Street malfeasance, and corporate greed a cornerstone of his populist campaign. But in a newly published transcript of a conversation between the Democratic presidential candidate and the editorial board of the New York Daily News, Sanders admitted he has not formulated any specific plans to break up the big banks or bring jobs back from overseas.
In the wide-ranging interview, which took place last week but was published Monday night, on the eve of the Wisconsin Democratic primary, Sanders appeared to reveal a damning lack of understanding of the exact regulatory statutes, laws, and powers he and a cooperative Congress could use to break up “too big to fail” banks during the first year of his administration, an oft-repeated promise in his stump speeches. Pressed by the Daily News as to whether the Federal Reserve had that authority, Sanders seemed unsure:
Sanders: Well, I don’t know if the Fed has it. But I think the administration can have it.
Daily News: How? How does a President turn to JPMorgan Chase, or have the Treasury turn to any of those banks and say, “Now you must do X, Y and Z?”
Sanders: Well, you do have authority under the Dodd-Frank legislation to do that, make that determination.
Daily News: You do, just by Federal Reserve fiat, you do?
Sanders: Yeah. Well, I believe you do.
Asked for additional details on exactly how he would break up the banks (“What would it be? What would that institution be? Would there be a consumer bank? Where would the investing go?”), Sanders responded that how banks decide to “reconfigure themselves” would not be his decision. The Daily News was puzzled:
Daily News: Well, it does depend on how you do it, I believe. And, I’m a little bit confused because just a few minutes ago you said the U.S. President would have authority to order…
Sanders: No, I did not say we would order. I did not say that we would order. The President is not a dictator.
Daily News: Okay. You would then leave it to JPMorgan Chase or the others to figure out how to break it, themselves up. I’m not quite…
Sanders: You would determine is that, if a bank is too big to fail, it is too big to exist. And then you have the secretary of treasury and some people who know a lot about this, making that determination. If the determination is that Goldman Sachs or JPMorgan Chase is too big to fail, yes, they will be broken up.
Daily News: Okay. You saw, I guess, what happened with Metropolitan Life. There was an attempt to bring them under the financial regulatory scheme, and the court said no. And what does that presage for your program?
Sanders: It’s something I have not studied, honestly, the legal implications of that.”
…Continue reading @ Vanity Fair
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