Unions, Progressive Groups Petition Congress to Control Banks By Restoring Glass-Steagall Act

Unions and progressive groups are circulating a petition to congressional leaders, demanding they control the nation’s banks by restoring the Glass-Steagall Act, the Depression-era law that erected a wall between financial finagling and regular consumer banking.

The petition, formulated by the American Federation of Teachers, the AFL-CIO, the Economic Policy Institute, Jobs With Justice, Americans for Financial Reform and their allies, declares “Wall Street greed and risky behavior is out of control and needs to be reined in.”

“There is a simple solution: Pass the 21st Century Glass-Steagall Act,” it says.

In 1999, a Republican-run Congress passed and Democratic President Bill Clinton signed Glass-Steagall repeal. That, combined with lax or nonexistent regulation under the succeeding GOP Bush government, let the financiers run amok, using depositors’ money. Their finagling and fraud helped lead to the Great Recession, also called the Bush Crash.

“We’ve joined with other progressive and labor organizations that are fighting to make banks smaller, simpler and safer,” Teachers President Randi Weingarten said in an e-mail urging her union’s members and allies to sign the petition.

“Banks shouldn’t be allowed to gamble with the savings of ordinary Americans, and they shouldn’t receive taxpayer backing for their risk-taking. Working people need a rule that separates our piggy banks — checking and savings accounts — from the casino of Wall Street.”

Detroit Federation of Teachers executive vice president Terrence Martin backed her up. He said the banks’ casino gambling sucked his city in and “Wall Street helped drive us over a cliff” into bankruptcy “through predatory tricks and traps.” Detroit’s bankruptcy has led to huge pension cuts for city worker retirees and mass firings from the schools, among other impacts.

Source: PAI