Vermont Sen. [crscore]Bernie Sanders[/crscore] ramped up his onslaught against the financial sector in a campaign speech on Tuesday with a series of drastic proposals, including a promise to break up big banks within the first year of his presidency and to put a $2 cap on all ATM withdrawals.
“If we are going to create a financial system that works for all Americans, we have got to stop financial institutions from ripping off the American people by charging sky-high interest rates and outrageous fees,” Sanders said during a speech in New York City.
“In my view, it is unacceptable that Americans are paying a $4 or $5 fee each time they go to the ATM,” he continued, adding later that “people should not have to pay a 10 percent fee for withdrawing $40 of their own money out of an ATM.”
Sanders’ ATM proposal is part of a larger financial reform policy aimed at addressing what he says is the banking industry’s “greed, fraud, dishonesty and arrogance.” The 73-year-old democratic socialist has long pushed for reforming Wall Street and the commercial banking industry. And he hopes to provide a progressive alternative to fellow Democratic presidential candidate Hillary Clinton, who he claims is too cozy with Wall Street.
“If a bank is too big to fail, it is too big to exist,” Sanders said Tuesday, repeating a line he frequently uses on the campaign trail.
Sanders said that within the first 100 days of his administration he will require the secretary of the Treasury Department to create a “too-big-to-fail” list of banks and insurance companies “whose failure would pose a catastrophic risk to the United States economy without a taxpayer bailout.”
“Within one year, my administration will break these institutions up so that they no longer pose a grave threat to the economy,” Sanders promised.
He also called for a tax on Wall Street speculation — revenue from that will be used to make public colleges tuition-free — and for transforming for-profit credit rating agencies into independent, non-profit institutions.
While citing the Bible and Dante’s “Divine Comedy” in his speech, Sanders also lamented as “unacceptable” that some interest rates on some credit cards reach “20 or 30 percent.” He would set in place a 15 percent interest rate cap.
Sanders also called for an end to the payday lending industry and said that post offices should provide banking services in order to help low-income communities, which Sanders said have limited access to the banking system.
Sanders’s call for the ATM fee cap is likely to generate the most buzz given the public’s widespread use of cash machines. As a U.S. congressman in 1996, Sanders called for limits on fees. During a House Banking Committee that year he said that the $2 and $3 transaction fees being charged at the time were exorbitant.
He also warned that banks would likely increase the fees in the future, a prediction which has proved accurate. According to Yahoo! News, the average ATM fee in the U.S. is $4.52 per transaction and has increased more than 20 percent over the past five years.
Clinton’s own financial reform plan does not address ATM fees, but she did touch on the issue in response to a question from talk show host Stephen Colbert back in October.
“Can you at least just get back from them the $3 they charge us to take $20 out of an ATM machine,” Colbert said jokingly.
“You know what, we need to go after that too, don’t you think, yeah, yeah, it’s usurious,” Clinton replied.