Bust the Trusts, Bust the Banks

"Bust the Trusts" was the populist cry of the latter part of the 19th Century and the first two decades of the 20th Century.

We do not have the trusts, or the monopolies that existed back then. But we need to aggressively break up the large financial institutions into smaller entities. According to the end of this article, by the time this mess is over, JP Morgan, Citi and Bank of America will each come out of it with close to two trillion dollars in "assets" apiece. (I put the word "assets" in quotations for who the hell really knows for sure.)

They really are too big to fail. But if they were to fail, a two-trillion-dollar bank failure would wreck the economy.

Old joke, redone:

Q: What's the difference between the financial sector and the Girl Scouts?

A: The Girl Scouts have competent adult supervision.

The remedy is two-fold: First, go back to regulating the piss out of them. Let the banks make money, nothing wrong with that. But let's put the competent adult supervision back in. Federal and state regulators are paid by the governments, they have no reason (other than corruption) to turn a blind eye to these shenanigans.

Second, break up the big banks. Break them into much smaller pieces. A bank or brokerage house with assets of fifty billion or so is still plenty fucking large. But if it were to fail, it wouldn't bring the world's economy crashing down with it. A two-trillion-dollar bank failure would wreck global economy. And for a large project, the need to have multiple banks in play would also work to ensure that there were many eyes paying attention to what is going on.

The last thing we should do is listen to the cries of the bankers and their asswipe buddies in the GOP that "we've learned our lesson" and "we would never do anything like that again." That is bullshit, they have done it before.

The question is whether we will be fooled again.