Posted by: coastcontact | April 24, 2013

Too Big to Fail, Too Big to Exist

When the Federal government rescued the banking industry in 2008 there were 734 banks involved according to CNN.  The list is here.  You may recall that the idea of bailing out the banks was based upon a proposal submitted by then Treasury Secretary Henry Paulson near the end of the Bush administration.  Initially the proposal was rejected by the congress.  After the stock market took a significant drop the proposal was passed.  Many people, primarily Republicans, opposed the bail out.  Many condemned the idea of “too big to fail.”

This past April 9 Congressman Brad Sherman (CA – D) and Senator Bernie Sanders (VT – I) introduced bills in both houses to define too big to fail financial institutions with the purpose of breaking them into smaller units that could fail without impacting the country.

There are no cosponsors to these bills.  According to govtrack.us there is a 2% chance the proposal will get past a committee review and a 0% chance of enactment.

So where are all the indignant people who voiced their dismay in government bailouts?

I am not a reporter and I do not have the resources to walk through the offices of senators and congressional members.

This lack of concern does tell us that on camera pronouncements mean nothing.

What will happen when the next bank failure occurs?

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Responses

  1. All good thoughts and i also share your doubts as to our banking system. just the other day the house voted to eliminate the ‘ban on congress insider trading, so we know where their thoughts lie on all of this.


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