Earlier this month, Senator Sherrod Brown, Democrat from Ohio, introduced a bill that calls for the breakup of the nation’s six largest banks. It’s called The Safe, Accountable, Fair & Excellent (SAFE) Banking Act of 2012. The bill was read and referred to the Committee on Banking, Housing, and Urban Affairs, and has yet to move forward. The Financial Times gave an interesting update to the bill’s status on Wednesday, suggesting that there maybe an outside chance of bipartisan support for the bill — but likely not enough.
The bill would seek to break up Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley. This would hardly be a popular bill considering Washington’s rightward, pro-business bent, and indeed Senator Brown’s last iteration of the same bill, which he introduced in 2010, lost 61 to 33, reports the FT.
But, says the FT, there’s an increasing amount of support for breaking up the banks from completely opposing sides of the aisle:
The left-leaning Mr Brown is one of an increasing number of US legislators, policy makers and private sector executives who are calling for an overhaul of the biggest banks. Perhaps surprisingly in politically divided America, support for ending “too big to fail” has gained adherents on the left and right. And the subject has been given more oxygen since JPMorgan revealed a $2 billion trading loss this month.
House Democrat Brad Miller has introduced a “companion House version” of the bill, reports the FT, and he has high hopes for the law’s prospects, despite representing the home state of Bank of America — one of the worst too-big-to-fail offenders.
If we had to handicap the bill’s chances, we’d place it just north of a snowball’s in hell. After all, even if it somehow passed a Republican House, our pro-business president, who has to constantly convince half of the electorate that he is not Stalin reincarnate, would likely not sign a bill like this in an election year. At least we’re having the debate.