In a fiery floor speech at the US Senate on Friday, Elizabeth Warren argued not just against the bank-friendly provision that was snuck into the CRomnibus, but against the very existence of very large banks. What’s fascinating is that rather than an economic argument against mega-banks, she offers a political argument. She says that a century ago a lot of people called for trusts to be broken up “because they had too much economic power. But Teddy Roosevelt said we should break them up because they had too much political power.”
Watch: Elizabeth Warren makes the political case against giant banks
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Today, Warren wants to apply the same logic to giant banks. She says that like the trusts of yore, their “concentrated power threatens the very foundations of our democratic system.”
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This is a potentially potent line of argument because it creates an ideological rationale for some hardball politics. To win a fight against giant banks, you need allies who have some muscle on Capitol Hill of their own and who also have a dog in the fight. One such ally could be the giant banks’ competitors — smaller regional banks. But to forge that alliance, you need a reason to propose measures that target the biggest banks but not the regional ones, even though the regional banks in question are often not exactly cuddly small businesses.
Warren has herself just such a reason with this Rooseveltian line of argument.
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