Reforming the Banks for Good
Dissent, Summer 2014
6 Pages Posted: 17 Aug 2014 Last revised: 30 Sep 2014
Date Written: July 1, 2014
Despite pronouncements and promises of sweeping reform, many of the conditions that caused the financial crisis of 2008 persist six years after the multi-trillion-dollar bank bailouts began. While several steps have been taken to curb reckless practices, the U.S. financial system is still not safe enough.
Today, the top banks are larger than they were before the crisis and engage in many of the same behaviors that led to the financial meltdown, including using large amounts of short-term borrowing to fund purchases of speculative securities. The largest banks have used their political muscle to shield their enterprises and individual bankers from criminal prosecution and to resist the toughest reforms. While global banks have reportedly paid $100 billion in legal settlements with the U.S. government for crisis-related misbehavior, this may not deter future abuses, because the bad actors rarely have been held personally responsible. Instead, the banks and their shareholders have picked up the check.
Keywords: financial crisis, banking, banks, Dodd-Frank, Glass-Steagall
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