An Independent Voice on Financial Reform
(Hmm, I wonder why . . .?)
Senator Ted Kaufman, Joe Biden’s replacement in the Senate, has rapidly emerged as perhaps the leading Congressional advocate for real financial reform (Chris Dodd’s version doesn’t come close).
Not a few people have noted that Kaufman’s path to the Senate — he was appointed — insulated him from the soul-rotting temptations of Wall Street campaign cash.
Here’s Kaufman’s latest:
Letting giant institutions fall into bankruptcy is not the answer to “too big to fail.” When Treasury Secretary Hank Paulson decided to let Lehman Brothers fail, the credit markets immediately froze and the worldwide financial system was on the brink of collapse. If we do nothing about these megabanks and wait for another crisis, future presidents”whether Republican or Democrat”will face the same choices as President Bush: whether to let spiraling, interconnected TBTF institutions, like AIG, Citigroup and others, collapse in a contagion, sending the economy into a depression, or step in ahead of bankruptcy and save them with taxpayer money.
The answer instead is to break up these megabanks. As even Alan Greenspan has realized about our current predicament: “If they’re too big to fail, they’re too big.”
–Letter to Editor, The Wall Street Journal (4/14/2010)
And the arguments against this are??