Is Robert Reich the smartest man in America? If he isn’t #1, he’s definitely in the top five. Recently, professor Reich, who was Bill Clinton’s labor secretary, has been laying out a series of commentaries that have destroyed some of conservatives’ conventional wisdom on economic topics. He started by joining the chorus calling for a $15.00 minimum wage. Now he’s advocating changes that are likely to be opposed by some politicians on both sides of the aisle.
In his most recent video commentary, Reich takes on Wall Street. He lays out some facts about the big banks, then explains what needs to be done to put an end to Wall Street control over our economy and our politics. It’s oh, so simple to do, but in this age of Citizens United, it will take more political will than most of our elected representatives are willing to muster, for the reason Reich mentions: Wall Street lines the pockets of politicians of both parties.
“Banking should be boring, not like going to a casino,” Reich observes. But, he points out, politicians are busy removing some of the protections of the Dodd-Frank Act, that was passed to try and prevent another crash like the one in 2008. Remember those “too big to fail” banks, that were a huge part of the problem? Reich notes that they are now even bigger than they were seven years ago.
So, how do we rein in Wall Street? Reich has three proposals:
- Bring back the Glass-Steagall Act, which separated investment and commercial banking. The act was repealed in 1999.
- Put a small tax on every stock market trade. This would discourage speculation, and would generate billions in new revenue.
- Break up the big banks. If a bank is “too big to fail,” then it’s too big to exist.
Reich points out that his suggestion isn’t radical at all. When the oil trusts, and later the phone company, became too big and powerful, anti-trust legislation was used to break them up. Reich says that now we are in a similar situation with the big banks.
If we keep allowing Wall Street to privatize profits, and socialize losses, we are doomed to repeat the boom-bust cycle we are trapped in. Every time another bubble bursts, average Americans get screwed, while the bankers walk away unscathed. Robert Reich has a solution, if only those in a position to do something would listen.
Here’s Robert Reich’s video on how to handle Wall Street, via YouTube:
Featured image via YouTube screen capture.