Democratic presidential front-runner Hillary Clinton called for the U.S. government go after risk in the market in an effort to “rein in” the big financial institutions.
Speaking Thursday, Clinton previewed her plan to “go after Wall Street abuses and to rein in the ‘too-big-to-fail’ banks and other institutions.”
Clinton explained, “When you think about what happened to us in 2008, Lehman Brothers, AIG, the big insurance company, they were as big a problem as any of the big banks. They were all problems. So if you only reinstate Glass-Steagall, you don’t go after all these other institutions in what is called the shadow banking system — hedge funds and other big financial entities that have too much power in our economy.”
“So I’ve studied this real closely, and what I’m proposing is that we go after the risk, and if they are too big to manage, that’s a risk, and they should not continue,” suggested Clinton.
“If they are so big that they are causing disruptions in the market, that’s a risk. So I have what I consider to be a more comprehensive approach for what we need to do to rein in the big institutions, including the big banks,” said Clinton. “We also have to do more to hold individuals accountable for their bad behavior and the actions that lead to these problems.”
Clinton explained that former chairman of the Federal Reserve Ben Bernanke said “people should have gone to jail” in the aftermath of the 2008 recession, but “it wasn’t up to the Fed. It was up to the Justice Department.”
In 2008, according to Clinton, “The laws were not as strong as they needed to be to hold individuals accountable. So I will do everything I can to make sure that individuals are held responsible, and if we need to change the laws, we will change the laws.”
“And we have to enforce and implement Dodd-Frank. You know, Dodd-Frank has a lot of good stuff in it, but it’s been slow going because all of the big interests have been fighting against implementing,” claimed Clinton. “We’re making progress on it, we are going to enforce it, we are going to implement it, but I am going to go after risk.”
“Risk,” according to Clinton, “is associated with bigness in a bank, sometimes risk can be in an insurance company, sometimes risk can be in the shadow banking system. So I’m going to go after what I think are the real problems, not to problems of the past, the problems of today, because I’m interested in is stopping something like this from happening again.”
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