Congressional Support for Re-instating Glass-Steagall on the Move

Ten Congressmen have added their names as sponsors of Rep. Marcy Kaptur’s (D-Ohio) bill to restore the core provisions of FDR’s Glass-Steagall Act (H.R. 381) over the last two weeks. Including Kaptur, there are now 54 sponsors of the legislation, which aims “To repeal certain provisions of the Gramm-Leach-Bliley Act and revive the separation between commercial banking and the securities business, in the manner provided in the Banking Act of 1933, the so-called ‘Glass-Steagall Act,’ and for other purposes.”

Kaptur’s bill is identical to the “Return to Prudent Banking Act” she had introduced into the 113th Congress. At the time of the expiration of that session, the bill had 83 cosponsors—but had never been given a hearing by the Republican-controlled leadership of the House Financial Services Committee. That Committee is chaired by Texas Republican Jeb Hensarling, who was also chair in the last Congress.

Four Republicans have joined the Democrats in sponsorship of H.R. 381, including initiating cosponsor Rep. Walter Jones. (R-NC) None of the known Senate supporters of restoring Glass-Steagall, who had introduced legislation to that effect in the 113th Congress, have yet reintroduced their bill.

The upsurge in support coincides not only with the very widespread mootings of an imminent global financial blowout worse than 2008, but with a steady campaign of public support for re-instatement. Leading the charge has been former Maryland Governor Martin O’Malley, now on the verge of his official announcement of candidacy for the Democratic Party nomination for President, who has repeatedly stated that Glass-Steagall is the essential first step in dealing with the crises in employment, wages, and living standards in the United States.

During the second week of May, the International Association of Machinists made Glass-Steagall’s restoration, and Kaptur’s bill in particular, a major item in their lobbying on Capitol Hill.

See: Machinists Push Congress for Glass-Steagall

In New York, a resolution is currently in the state legislature, with multiple co-signers, calling on Congress to pass legislation to re-instate Glass Steagall.

On May 15, Robert Reich, former Labor Secretary, and keynote speaker at the Iowa statewide “Raising Wages/Working Families Summit” the next day—the first of a national series, listed restoration of Glass-Steagall as a key Presidential candidacy criterion.

The major Wall Street banks have gotten the message. Earlier this month, Wall Street bankers had a war council session at Rockefeller Center. Press leaks have reported on their campaign of threats to cut off campaign funds to Congressmen who join the drive for Glass-Steagall. As the momentum in support for H.R. 381 shows, that pressure could well backfire.

LaRouchePAC’s campaign for reinstating Glass-Steagall, which went into high gear in October 2008, continues to expand as well, including through lobbying at state legislatures, and rallies in Alexander Hamilton’s home town of Manhattan. Lyndon LaRouche stresses that without the re-establishment of Glass-Steagall, the U.S. economy cannot be saved.