This astute Kos poster dug up an old NYT article about the passage of one of many deregulation laws, this one letting banks off in 1999. Overwhelming support from both parties, the bulk of the opponents coming from, yes, the Progressive Caucus. And check out the euphoria in this opening paragraph from the allegedly liberal Times.
Congress approved landmark legislation today that opens the door for a new era on Wall Street in which commercial banks, securities houses and insurers will find it easier and cheaper to enter one another’s businesses.
A new era! Passed just before the dot com bubble collapse and heralding a brand new financing bubble complete with no doc loans, ridiculous extensions of consumer credit, and the ascent of variable rate mortgages.
It was “one of the most significant achievements” of the White House (Clinton) and Congress.”
The measure, considered by many the most important banking legislation in 66 years, was approved in the Senate by a vote of 90 to 8 and in the House tonight by 362 to 57. The bill will now be sent to the president, who is expected to sign it, aides said. It would become one of the most significant achievements this year by the White House and the Republicans leading the 106th Congress.
The opposition, the naysayers, were accused of adhering to pedestrian economics and “old thinking.” Imagine.
The decision to repeal the Glass-Steagall Act of 1933 provoked dire warnings from a handful of dissenters that the deregulation of Wall Street would someday wreak havoc on the nation’s financial system. The original idea behind Glass-Steagall was that separation between bankers and brokers would reduce the potential conflicts of interest that were thought to have contributed to the speculative stock frenzy before the Depression.
….
The opponents of the measure gloomily predicted that by unshackling banks and enabling them to move more freely into new kinds of financial activities, the new law could lead to an economic crisis down the road when the marketplace is no longer growing briskly.
Pessimism. Gloom and doom. The sky is falling. They had to be dragged into the twenty-first century kicking and screaming. I mean, check out this guy:
”I think we will look back in 10 years’ time and say we should not have done this but we did because we forgot the lessons of the past, and that that which is true in the 1930′s is true in 2010,” said Senator Byron L. Dorgan, Democrat of North Dakota. ”I wasn’t around during the 1930′s or the debate over Glass-Steagall. But I was here in the early 1980′s when it was decided to allow the expansion of savings and loans. We have now decided in the name of modernization to forget the lessons of the past, of safety and of soundness.”
The dissenters:
One Republican Senator, Richard C. Shelby of Alabama, voted against the legislation. He was joined by seven Democrats: Barbara Boxer of California, Richard H. Bryan of Nevada, Russell D. Feingold of Wisconsin, Tom Harkin of Iowa, Barbara A. Mikulski of Maryland, Mr. Dorgan and Mr. Wellstone.
In the House, 155 Democrats and 207 Republicans voted for the measure, while 51 Democrats, 5 Republicans and 1 independent opposed it. Fifteen members did not vote.
Slightly different topic, current economic news as told by Calvin and Hobbes:
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March 25, 2009 at 10:37 pm
Anonymous
A broken clock is right twice a day. That legislation didn’t bring the banks down. Fannie Mae and Freddie Mac being pressured to give loans to people who could not afford them brought the banks down.
March 26, 2009 at 5:35 am
Mr. Greenjeans
The Glass-Steagall act was put in to stop what has happened. It was repealed. What has happened has now happened twice. Greenspan even said that he didn’t expect these jerks to eat themselves in the name of greed but they did.
Even though Phil Gramm and his puppets wrote this bill both Republicans and Democrats were in on it and deserve blame. Never trust anybody to do the right thing when money is involved. Especially when billions of $$$$$$ are involved.
March 26, 2009 at 5:58 am
Mr. Greenjeans
Here is a great example of how the right wing are different that normal people. This from John Hinderaker at Powerline:
I guess that is fair enough if yoiu don’t have anything else in your life… The thing that is unbelievable is when you compare what he said about out last President:
If this is the way wingnuttia looks at Bush and Obama then maybe there IS no room for debate.
March 26, 2009 at 7:06 am
Carson Park Ranger
“A broken clock is right twice a day.”
And the credulous Anonymous is wrong 24-hours a day. The canard that Anonymous refers to in blaming all of our woes on mortgage loans to poor people was fabricated as a way to blame the financial crash on progressive federal policies.
March 26, 2009 at 8:01 am
Eric Kirk
Yeah, they’ve kind of backed off that one Carson. Again, I think Jon Stewart had a lot to do with it. I’m sure it’ll be back.
March 26, 2009 at 9:22 am
Fred Mangels
Greenjeans wrote, “If this is the way wingnuttia looks at Bush and Obama then maybe there IS no room for debate.”.
I think if you look at it from outside the Left/ Right viewpoint, you’ll see both Left and Right will defend their own and attack the other simply from partisanship.
I look at it from a somewhat detached third party perspective and don’t know whether to laugh or cry when I hear partisan types defending their candidate for one thing and attacking the other’s candidate when he does something similar.
It happens time and time again and apparently a lot of Right and Left wingers do the same thing and don’t recognize the hypocrisy.
March 26, 2009 at 9:59 am
Carson Park Ranger
“I look at it from a somewhat detached third party perspective…”
This is what most Libertarians like to believe, but they look at things from a narrow, almost religious liberal, free-market point ideology. They are consistently right-wing on most issues of governance and the economy. They like to think that they are above the “partisan fray” because their candidates are unsuccessful and because they support liberal positions on individual rights and tend to support the Establishment Clause.
Like MENSA members, they tend to see their beliefs as proof of their superior intelligence.
March 26, 2009 at 10:25 am
Mr. Greenjeans
Fred, for the most part I agree with you. Each side will defend their own. My point was that this guy, John Hinderaker, claims that he fears that Obama is “remarkably ignorant” because he pronounced “Orion” incorrectly (Hehehe, I have to laugh just thinking about that statement.). Not only “remarkably ignorant” about astronomy but “remarkably ignorant” about economics and history. Personally I cannot understand where he could get that idea but he can have his opinion. What bothers me is that putting his opinion of Obama up against his opinion of George Bush it is remarkable. When he calls Bush “a man of extraordinary vision and brilliance approaching to genius” and then calls Obama “remarkably ignorant” Hinderaker appears to me to be insane.
When you add to that what Rose/Anonymous said it becomes bazaar. Freddy and Fanny may have brought themselves down but they certainly did not bring down the banks. The banks own decisions brought the banks down and because regulations that would have slowed if not stopped those decisions from being made were repealed. Also the fact that banks fail is not that huge of a deal. The problem is that these banks that were bailed out were deemed to be “to big to fail.” Therein lies the problem. The Glass-Steagall Act of 1933 would have made it difficult if not impossible for these banks to get to the point of being to big to fail. Other regulations would have made the stupid decisions impossible to be made. Can you say credit default swap? Can you say 35 to 1 leverage?
So to tie all this together I will say that the people who run the banks are Republicans. Hinderraker is a Republican. Republicans think Obama is “remarkably ignorant” yet Bush is “a man of extraordinary vision and brilliance approaching to genius.” Is it any wonder that the banking industry needs to be regulated and how could anybody ever think that repealing the Glass-Steagall Act would be a good idea?
LOL – Too much coffee.
March 26, 2009 at 1:03 pm
Anonymous
Greenjeans, it’s “bizzare,” unless you meant a middle-eastern outdoor market.
Both parties are wrong, and the progressives weren’t right 10 years ago either–if they had it their way an economic collapse would have happened even sooner.
There is an inherent mathematical flaw with our financial system and unless we want a fundamental change in the way our society distributes wealth, “hide the sausage” needs to continue as long as possible.
March 26, 2009 at 2:03 pm
Eric Kirk
Both parties are wrong, and the progressives weren’t right 10 years ago either–if they had it their way an economic collapse would have happened even sooner.
Well, we didn’t have any deficits then. We hadn’t yet lost as much of our manufacturing. So yeah, it might have been rough, but it may be rougher now. All of the sudden Republicans care about deficits again, and we desperately need some restructuring to stop the hemorrhaging of jobs. That means development, with government help, of industries in which we can remain competitive. Industries which require education and skill, none of which was being farmed to places like India and Australia 10 years ago.
We bought 10 years with a bad credit induced bubble and we’re probably worse off for it, not better.
The mistake was negotiating free trade agreements sans labor and environmental standards. Blame Clinton for not standing up to the Republicans and special interests at the time.
March 26, 2009 at 6:55 pm
enviroraptor
Too bad Leftism became watered down to “Progressive” politics of bean-counters. This is what happened to our revolt against the System with the following generations forgetting why the capitalist system is never stable, always needs fresh markets or its economic system dies. The Chinese going capitalist will win by default because they’ve got the built-in growth market with their huge population. No activists around here are even thinking about a sustainable economic system. Like Eric’s example shows, political activism has devolved from radical to establishment changing of the guards while the emperor still runs around with no clothes.
March 26, 2009 at 10:00 pm
moviedad
Thank You CPR.
Lately, so many apparently intelligent people parrot the daily propaganda so fluently, that I almost expect to see the “Ticker-Tape” running in front of them. It’s not so much about beliefs or opinions about facts. Truth is, both sides are targets of disinformation. As far as “ten years ago…” Many of us in our later years have been on this thing since Nixon. He didn’t go to jail and how many died in Viet Nam, because of that Scumbags political games in Paris. These current thieves will not do a day in jail either, unless they’re “Whistle-blowers.”
I know when someone is on the right track, when I hear: “It’s aristocracy vs. peasantry.”
If you truly believe there is a difference in overall political goals between different members of the ruling class. Then it’s over before it starts.
We should be talking about a national strike; instead we are all arguing about which billionaire is on our side.