Monday, March 9, 2009

The Banking Lobby

The banking lobby is digging in to make sure that we learn nothing from this crisis, so they can keep playing their heads-we-win-tails-you-lose game. From Bloomberg:
Alan “Ace” Greenberg, the former Bear Stearns Cos. chief executive officer, said he sees a “very small” chance the Great Depression-era Glass-Steagall Act that separated banking and investment banking could be reinstated.

“Practically you can forget about it, it’s not going to happen,” Greenberg, 81, said today in an interview on Bloomberg Television. “The people who lobbied so extensively for the extinction of Glass-Steagall are still around.”
This is why Simon Johnson talks about the only obstacle to effectively fixing our financial system, since most economists agree temporary nationalization is the best option, is the power of the banking lobby. They really do control the levers of government. If the seemingly endless stream of cash Wall Street has siphoned off from the taxpayers isn't going to be a total waste, we need to put preventive measures in place to guarantee this type of crisis never happens again (at least in our lifetimes, until our children and grandchildren forget our lessons, as we did with the lessons of the Greatest Generation).

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