Sanders on breaking up banks "I have not studied... the legal implications of that"
- Thread starter The Technomancer
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So then why not address those points. And instead of proposing breaking them up, propose that their influence be limited and propose regulatory measures that encourage benefits for small businesses.
I guess he just sounds too idealist or populist to me, and without thought of practicalities or consequences. Similar to Trump's giant wall or deport all immigrants, it's an idealist statement with no practicalities or thought on consequences, and that's an idiotic approach in my book.
Breaking up the banks today is not the same as breaking up Standard Oil in 1911. They are far more complex and have so many subsidiaries which are all interconnected. Let's say they are divided based on function ie retail, business and investment banking. 2/3 would still end up being too big to fail. You would need to subdivide corporate and investment banking further but to what end?
Box of Kittens
Banned
Whether or not you like Hillary Clinton or her policies, she is a wonk who can go into quite a bit of detail about her policies, certainly much more so than Bernie Sanders.
I like that Sanders is raising some important issues and putting them at the forefront of the conversation. It's good to have prominent people advocating big ideas, even if I don't agree with all of the ideas. But he doesn't really have any way of accomplishing any of them. On policy matters he's light on the details, and his ideas of how to accomplish anything politically are completely unworkable. Is he helping Democrats downballot? No. OK, he regards the Democratic Party as part of the corrupt establishment. Fair enough. So what has he done to help like-minded people get elected, not just this cycle but throughout his career? He actually thinks he can get Republicans to vote for his proposals by mobilizing young people to lobby them.
This is the real problem with the "political revolution" and frankly with the American left in general. It's a top-down approach that sees the presidency as the be-all and end-all. At best it gives lip service to the idea of voting in midterm elections and at worst it just assumes Congress doesn't matter at all because the left loves to romanticize the "bully pulpit" and assumes that if the president just says the right things he can steamroll Congressional opposition. Worst of all, this top down view never even acknowledges the existence of state legislatures. Quite frankly the way the left virtually ignores statehouses (in contrast to the way the right in general and the Tea Party in particular focus on them) is just as big an impediment to progress as the issue of money in politics.
Finally, the comment on corporate media corruption really makes me wonder how much US-based media you consume. Sanders really hasn't been pressed on his policies much by the big media, which is why this interview is garnering so much attention. The New York Daily News is a relatively minor media outlet. In influence it ranks well behind the broadcast networks, the major cable news outlets, and influential newspapers (New York Times, Wall Street Journal, Washington Post, etc.) but they're pushing Sanders for details in a way the major players largely haven't. If anything, the media has been a net positive for Sanders, not because they favor him, but simply because they want people interested in following the horse race so they'll tune in. They love to play up the underdog's chances.
And in the end all this would do is reduce the economic power of America in the world economy, shifting money and investments away from US Banking institutes to European ones. The "too big to fail" burden would then simply be shifted instead of fixed.
Orbis Tabula
Member
I'm not sure how "she's knows what she's taking about most of the time" translates go "she can accurately predict the long term consequences of every decision she's ever made." She's competent, not psychic.
Voting for the Iraq war was stupid and she should be criticized for it, but I don't think that it's fair to say she "knew full well what the end result would be."
Perfect Blue
Banned
I don't think that ever mattered to his followers. It was all about "feel the Bern" and participating in some kind of political meme created from Reddit.
Has Sanders even been asked why he has never been on the Finance Committee or the Banking, Housing, and Urban Affairs Committee? I would imagine being on those or trying to get on them would have given him real opportunity to address some of the more prime issues he has had over the years.
First: I'm not convinced that having large financial companies are unhealthy for the US economy. Especially when they are so interconnected to other industries and the world market as a whole. That depends entirely on what you mean by "our economy".
Mainly though, this interview would have been the perfect opportunity for Bernie to get into the gritty and dirty bits of financial reform. He could have talked about what exactly he'd do if JP Morgan were in his crosshairs for "breaking the banks". But instead he professed his ignorance and talked about a world post Bernie in which magically the economy is made better ipso facto his financial destruction.
Something they're doing in large part as a result of Dodd-Frank, that thing Sanders claims achieved nothing.
Which he's factually wrong about. Exactly the kind of guy we want presiding over a major overhaul of the banking sector, right?
As a candidate running on increasing regulation on the banking systems and the "too big to fail" concept you would think Sanders would have been devouring every legal brief and assessment of the MetLife case prior to, during, and after the case especially following the resultant verdict. This is at the very core of his campaign and he doesn't get it. The equivalent would be Hillary Clinton making some handwavy junk comments on foreign policy. He sounds out of his depth and when he sounds like that on his single biggest issue there is substantial cause for concern.
In reality Sanders is a populist candidate running on a platform of pure ideology and is demonstrably ill equipped for the job. His proposals are backed by weak and inherently flawed policy. His methods to pass any of this legislation is naive at best and delusional at worst. His willingness to engage and learn absent in favor of his preference to shout his ideology at opposition.
He is very much a Trump/Cruz styled candidate and just like Trump and Cruz he mobilizes a disaffected vocal minority who vote based on what makes them feel good, not on grounds of understanding the issues and making an informed choice.
dave is ok
aztek is ok
Yeah, the thread title sucks.
Without Dodd-Frank it's very possible that MetLife could have been another Lehman or Goldman during the mad throws of a second crisis. Their leverage ratio in 2008-09 was ludicrous and while that position improved in 2011 they were still in a risky position should a second crisis occur.
The fact that Bernie is supposedly ignorant of their recent court dealings is concerning to say the least, as it is directly related to the question of "too big to fail" and the regulatory power of Dodd-Frank.
there is so much truth in this post. People reaaaally need to wiki dodd-frank at the very least. It is what makes bernies campaign even more baffling and disingenuous.
They should also Wiki the "auto and bank bailout" and "quantitative easing" while they're at it.
You would think he would be at least watching it closely since it directly related with the core of his platform.
funny I stumbled on this interview like right now.
didn't expect a thread to be honest.
This interview has so much wrong in it I don't even know where to start.
I'm starting to think that Trump would be a better president than Sanders.
I mean at least Trump know a thing or 2 about the stuffs he's been doing for the last 20 years.
Can't really say the same from Sanders here.
didn't expect a thread to be honest.
This interview has so much wrong in it I don't even know where to start.
I'm starting to think that Trump would be a better president than Sanders.
I mean at least Trump know a thing or 2 about the stuffs he's been doing for the last 20 years.
Can't really say the same from Sanders here.
Box of Kittens
Banned
Trump would still be worse. Much worse. I say this as someone who firmly believes Sanders would be a completely ineffective president.
Trojita
Rapid Response Threadmaker
That feel when you have a larger writeup and then accidently close the new post tab
In many ways this is because of how complex the financial system has become. It's a pipe dream, one Bernie might think he can accomplish but also deluding his supporters that it is possible. One way to fix the problem is through legislature in a democratic system, but with the current congress we have this is improbable. Executive Orders could be issued, but these won't hold up on review. Still hasn't stopped previous Presidents that have issued E.O.'s under shaky to downright illegal grounds (We had a President put a whole group of people, including citizens, in camps).
There is little to no punishment and the risk vs. reward is just too great to ignore. A firm could make billions while accruing a fine of only a few million when caught. There's little to no chance that chief operators are going to face prison time. We are in the dark timeline where entities have become "Too big to fail".
jack_package_200
Banned
Its shocking how little Bernie seems to know about recent financial law yet his entire platform as a one issue candidate is all all about the banks, Wall Street, and taxing the rich. Christ Bernie.
This
This
You're probably right,
I think Trump actually knows how it works in DC so he could probably implement some of his disgusting plan.
Sanders seems to have no idea how anything works so he will not be able to do anything.
I think it is concerning that Sanders seems to know less about the centerpiece of what he's worked for the last 20 years than Trump knows about Carson's job in neurosurgery.
Alandrus Sun
Banned
Not really, the thread title is accurate enough. First, he should have at least some insight as towards the legal implications of the decision even if it was just four days ago. Again, this is his primary issue and one he has been championing for over twenty years. He should know the in's and outs of every facet of the financial sector in America. Let me give a counter-example, when the Citizens United ruling came down you had people that very day commenting on the legal implications of the decision and how it would be a disaster for American politics. So yes, I do expect him to have some understanding on how a recent legal decision may affect his policies towards regulating the financial sector and breaking up banks.
However, more importantly, his "I haven't studied the legal implications" goes far beyond the MetLife decision. He reiterates that same sentiment at several other moments during the interview concerning the financial sector. He states that he doesn't exactly know which laws bankers and CEO's broke but he believes that they should have been prosecuted by the DOJ. Again, when pressed for specifics he states he isn't entirely sure but that he just knows that laws were broken. When asked about what SPECIFIC laws would allow him as President to break up these big banks he is incapable of providing an answer instead he answers with the same old "I think" I can do it. Of course, when that is inefficient he pivots back to rallying Congress to give him that authority. He also demonstrates a clear misunderstanding of the Dodd-Frank Act and the authority it grants.
Thus, when you take all of that together it is clear that Sanders has not studied "the legal implications" of his policies, especially with regards to breaking up the banks. The thread title is not disingenuous or faulty but true to form supporters are more concerned with attacking whether that specific sentences is 100% correct as opposed to looking at the entirely of the issue.
On a related note, I finally got the time to sit down and read the whole interview and all I can say is, "Yikes!" When they got to the part about foreign policy I couldn't believe how bad he still was on the issue. This part in particular I found hilarious:
Alright, so he starts off all but accusing Israel of committing war crimes during the 2014 conflict with Hamas. However, when asked whether he supported efforts to bring such claims before the ICC he backtracks and simply states he is against it. Why? Well, he doesn't support a lot of things but why should he tell you why it's not like he's running for President. But, then he goes back to claiming that 10,000 civilians lost their lives because Israel was completely indiscriminate in their conflict against Hamas. Of course, the actual figure revealed later in the interview was 2,300 killed, around 10,000 wounded. Facts, right?
Except Dodd-Frank has already largely fixed the worst of this.
If your standard on banking reforms is how many executives you've put in jail your ideology runs closer to the Reagan era war on drugs than real financial reform. You're calling for catharsis, not reform. (and by 'you' and 'your' I mean anyone reading this, not the quoted individual)
If instead you want to see some meaningful change just look to Dodd-Frank and the impacts it has had on MetLife, likely other insurance companies soon to follow, and now GE. These companies are self-regulating and self-deconsolidating specifically to avoid the regulations required of larger size via Dodd-Frank, namely the amount of on-hand reserves they're required to maintain.
The response to the '07-'08 lending crisis is working. "Too big to fail" is simply the reality of a global economy. If "too big to fail" isn't acceptable for a multi-national banking company that lends and borrows at every level of the economy then shouldn't it be unacceptable for Greece and Italy? Shouldn't it be unacceptable for the poorest states in the union? Shouldn't hospitals, university systems, etc. all be held to this same standard?
Of course not, because doing so is an isolationist pipe dream that would require heavy handed interventionism into both domestic and foreign policy.
Its really not that complicated, he rallies on the income inequality and fraudulent nature of wall streets but when it comes to actually implementing his ideas he's no corporate restructuring expert. He would have his advisors take input from think tanks and experts in the field and go from there, which is exactly what Obama has done, the white house has a division called the national economic council that would actually research how to implement policy.
jakonovski
Member
It's curious how the correct choice in just about everything in US politics is to perpetuate the status quo. While Bernie does not have the answers, I think that in the case of banking it's that there is no answer. The banks have purposefully built themselves a dead man's switch and connected it to the collapse of the United States economy.
Oh?
The very technocrats he has thrown under the bus during this campaign to rally behind shit research that supported his claims?
That's precious; His plan is to use Dodd-Frank and econ experts -- two things he has railed against as innefective and "establishment", respectively.
It IS that complicated. That's what the class has been saying for months, and he's refused to listen. He killed all credibility with technocrat delegation on economic issues, and now that's the path forward?
What a mess.
Alandrus Sun
Banned
Right, he's just a legislator who is supposed to create and vote on laws that do exactly that.
What?
...
More to the point, you are assuming a question in banking that needs to be answered by some radical idea that Bernie cannot even articulate.
This assumption that 'big banks are a problem' is not based in fact, but in rhetoric and bombast.
PlayALLtheGames
Banned
Serious question: what the fuck are you talking about?
Having investment and commercial banks separate is a thing. We used to do it. Many economists support it. So, yes, it is complicated when you get to the details and Sanders will have to learn a lot more about that were he in a position to try and move on it, but acting like he needs be the economic expert who figures it all out when creating the law is just nonsense. Since when is this how American lawmakers make laws?
dave is ok
aztek is ok
Oh come on. We have evidence less than 10 years old that shows us this is not the case.
If the prospect of a companies insolvency threatens the entire U.S. economy, they need heavier regulations or to be broken up. Taxpayers should not be responsible for bailing them out.
I don't see how so? It wouldn't be difficult to envision a plan that breaks the banks ups, for instance one plan would be to have fsoc to establish a limit for bank sizes, by raising capital requirements for certain kinds of investments so high as to make it not worthwile to conduct bussiness in that area. The banks would then diminish in size and allow for others to compete. That's just one idea, an example is the urban institute is currently having various experts give restructuring plans for Fannie and Freddie Mac, they've ranged from winding down and selling off to nationalizing them as a utility to destruction with very high capital requirements to let them go with very tight regulation.
A few things:
The government made a profit on TARP, so while "taxpayers" were indeed responsible for bailing out some banks, the government invested our money wisely.
Second, 2008 wasn't the first time a large financial institution had a meltdown, the only difference between Lehman and previous financial failures was that we let it fail without sufficient support. The 2008 crisis wasn't caused by banks being too big, but by lax standards. The next crisis (because invariably there will be another one) will likely be caused by something else completely unforeseeable but for a few Cassandras.
Breaking up big banks isn't going to prevent another crisis, it will only shift capital and leverage around.
There is a standard operating procedure for the failure of a large financial institution, but in 2008 we had just gotten done with cushioning the Merrill Lynch fall and the public would not allow us to do the same for Lehman. Arguably a bad move.
A dead man's switch called "globalization". Oh noes.
Bernie claimed Dodd-Frank didn't have the answers, publicly and often, and said that he did.
Now we see Dodd-Frank actually effecting some change with companies breaking themselves up to get under the threshold and Sanders with no real answers on what he'd change.
There is an answer to banking reforms. They're already taking shape thanks to the 7+ excellent years of Obama's tenure. Clinton's goal is to continue those reforms. She isn't going to try sharply turn around the ship for a major change in direction, instead she is going to make steady progressive course corrections as the tide moves to favor further action. That is the best option we have when the hard turnabout can result in serious economic catastrophe that ALWAYS hits the lowest economic tiers first.
Slow and steady isn't just something the establishment support to keep the status quo, they do it so we don't see a major financial collapse that results in destroying the lives of average Americans.
AntraxSuicide
Banned
No, not random legal stuff. He can't answer to the legality of the whole damn thing. This is insane. And as to "White House legal team" I'm absolutely not going to elect him to run his little experiment through the courts. If something needs looking up, he can use the millions he's got on hand to hire a damn attorney. Or find one who's feeling the Bern to do it pro-bono. Jesus. College kids writing papers at midnight do more work than this.
I honestly don't like his answer there. Yes it's clearly a deflection, but a major point of most anti-fossil fuel proposals is the need for a framework to be set up that takes care of those people in that industry. It's why (and of course Bernie's people tried to argue against it) Hillary isn't in favor of an immediate blanket ban on stuff like fracking. You have to set up clean industries before hand that will take in those workers. You cannot hope to pass a clean energy initiative without honestly admitting that you're going to put a lot of poor people out of work, and you need a system to fix that.
See my answer above. And no, the intricacies of engineering do not compare to knowing in broad terms whether his entire plan is illegal. Like, that's not "3rd year Law School research topic" difficult, it's "What's the due date of the assignment" difficult. And to his climate change deflection, he needs to argue for what all of these financial workers are going to do in his (possibly illegal) Presidency. Because the way he's talking now, it sounds a lot like "Fuck you, got mine" to me.
Hillary is famously a policy wonk. She knows the details in and out of all of her policies, and has laid out very explicit details on her website that cover almost any potential case for the average American. Don't throw "corruption" around just because the candidate you like is pitifully under-informed (by his own choosing).
1. those policies already exist.
2. The banks paid those loans back with interest, FYI. No one was "bailed out". They received government loans in exchange for regulated restructuring. At the same time Dodd-Frank was put in place to directly address the very problem that let to the lending crisis.
The problem isn't "big banks". It's the existence of a very complex global economy and the market trading that allows for this economy to actually work. That's the real "problem" here, the existence of multiple interconnected global exchanges. The alternative is going back half a century in globalization and letting growing nations fucking starve. It is "fuck you, I got mine" on the national level.
Unless you can subvert the human instinct to search for a competitive advantage in all transactions there is no way to stop financial sector corruption. The people actually involved day to day will always find a loophole, a niche, an exploit, etc. to carve out an advantage and then exploit it until either they get nailed by a regulator (if it is even illegal), get burned, or enough people figure it out to take away the advantage. We can build in firewalls (like Glass-Steagal) or require buffering (like Dodd-Frank) but we can't fix the source, only be prepared to treat the symptoms. Every crash is unique and acting like X policy or Y bill fixes it all is absurd (which Sanders regularly does).
ultratruman
Banned
lot of double standards going on. If Hillary had given interview responses like this, she'd be CRUCIFIED
I agree... This is like the same type if answer that Trump gives about how we are going to make Mexico pay for a wall.
RustyNails
Member
She never gives responses like these. She has specific policy details and are not pie in the sky wishes.
I like Bernie but he never has specific proposals on how to accomplish any of his agenda. That Chris Matthews interview was worse than this.
dave is ok
aztek is ok
Yeah, banks paid down TARP with addition bailout funds from Obama because as long as they held onto TARP money they were barred from handing out big bonuses. Such wise investments. Also those banks who took TARP and other bailout funds didn't do what they were supposed to do with them, namely lend them or offer loan modifications.
TARP was 700 billion in a bailout that totaled probably over 10 trillion dollars.
Its really interesting because this is like the first time anyone in the media has held Sanders feet to the fire on some of those huge promises he is campaigning on. And the entire interview was pretty damn BAD.
And thus out comes the "Yeah but why not ask Hillary hard questions too!" crowd. Lol.
And_Gignac
Member
Welp. "Let corruption run rampant, is human nature!" would be a great slogan.
And globalization is kind of a "fuck you, I got mine, buy it".
AntraxSuicide
Banned
Yikes. This is literally one of the worst answers I've seen a politician give.
The TARP money was spent where it was needed to in order to maintain financial liquidity, the money wasn't necessarily given in order to use the funds directly in loan modifications.
The "10 trillion" you've cited is undoubtedly made up of the multiple programs enacted because of the crisis, most of which are proving sound investments as well and shouldn't be thrown in with the term "bailout" as they're not programs that are targeted at bailing out big banks on the verge of failure.
If not, what is the 10 trillion you cite?
I'm so confused by this statement. California has a budget surplus right now. But their budget problems were actually due in part to a lot of social programs. California basically has half of what Sanders is campaigning on enacted already (i.e. helathercare, minimum wage increases, free college, etc.) and has had them for awhile. Are you pointing to those as examples of democracy gone wrong?
dave is ok
aztek is ok
These are textbook "bailout" funds. The information was obtained in a FOIA request and it totaled about 8 trillion as of 2009. More has been given out since in additional bailouts, loan guarantees, QE, and interest free lending.
Fuck, they handed out 1.4 trillion on December 5, 2008 alone and kept it hidden for years.
The fact most people think America was paid back for it all is sad and disheartening.
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