Elizabeth Warren and John McCain are part of a bipartisan effort to pass a revived version of the 1933 Glass-Steagall Act, in a push to crack down on risky Wall Street practices.
Warren, D-Mass., and McCain, R-Ariz., are joined by Sens. Maria Cantwell, D-Wash., and Angus King, I-Maine, in co-sponsoring the 21st Century Glass-Steagall Act, which “would separate traditional banks that have savings and checking accounts and are insured by the Federal Deposit Insurance Corporation from riskier financial institutions that offer services such as investment banking, insurance, swaps dealing, and hedge fund and private equity activities,” according to a press release from Warren.
“If enacted, the 21st Century Glass-Steagall Act would not end Too-Big-to-Fail. But, it would rebuild the wall between commercial and investment banking that was in place for over 60 years, restore confidence in the system, and reduce risk for the American taxpayer,” said McCain in a statement.
As the Huffington Post explains:
Cantwell and McCain previously introduced the plan as an amendment to the 2010 Dodd-Frank financial reform bill, but the largely symbolic bill was never approved. The legislation introduced today would also bar banks that accept insured deposits from dealing swaps or operating hedge funds and private equity enterprises.
Sens. Sherrod Brown, D-Ohio and David Vitter, R-La., have also introduced legislation to force “Too Big To Fail” banks to hold more capital to protect against major losses.
Jillian Rayfield is an Assistant News Editor for Salon, focusing on politics. Follow her on Twitter at @jillrayfield or email her at email@example.com.More Jillian Rayfield.