Wednesday, November 11, 2009

A Senate Bill I Can Endorse - The TBTF,TBTE Act of 2009

Senator Sanders of Vermont is sponsor of a bill to break up the largest financial institutions. His petition has over 8,000 signatures. The Baseline Scenario blog has a post about it. Please sign the petition. It takes a whole 20 seconds and beats writing a real letter that won't get read by your Congressman or Senator. It will be interesting to see how our Senators kill it or gut it in the Senate, or how Treasury or the Fed spin it. The whole bill is readable by just about anyone. The entire bill is below.

A BILL
To address the concept of ‘‘Too Big To Fail’’ with respect
to certain financial entities.

1 Be it enacted by the Senate and House of Representa-
2 tives of the United States of America in Congress assembled,
3 SECTION 1. SHORT TITLE.
4 This Act may be cited as the ‘‘Too Big to Fail, Too
5 Big to Exist Act’’.
6 SEC. 2. REPORT TO CONGRESS ON INSTITUTIONS THAT
7 ARE TOO BIG TO FAIL.
8 Notwithstanding any other provision of law, not later
9 than 90 days after the date of enactment of this Act, the
10 Secretary of the Treasury shall submit to Congress a list

2

1 of all commercial banks, investment banks, hedge funds,
2 and insurance companies that the Secretary believes are
3 too big to fail (in this Act referred to as the ‘‘Too Big
4 to Fail List’’).
5 SEC. 3. BREAKING-UP TOO BIG TO FAIL INSTITUTIONS.
6 Notwithstanding any other provision of law, begin-
7 ning 1 year after the date of enactment of this Act, the
8 Secretary of the Treasury shall break up entities included
9 on the Too Big To Fail List, so that their failure would
10 no longer cause a catastrophic effect on the United States
11 or global economy without a taxpayer bailout.
12 SEC. 4. DEFINITION.
13 For purposes of this Act, the term ‘‘Too Big to Fail’’
14 means any entity that has grown so large that its failure
15 would have a catastrophic effect on the stability of either
16 the financial system or the United States economy without
17 substantial Government assistance.

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