Executive Intelligence Review
Subscribe to EIR

PRESS RELEASE


New Push for Glass-Steagall at European Parliament

June 30, 2015 (EIRNS)—In a joint column for the Frankfurter Rundschau, three Members of the European Parliament (MEPs) are pushing for a renewed attempt to get bank separation in Europe on the model of Glass-Steagall. The three authors are Fabio De Masi (Linke, Germany), Philippe Lamberts (Greens, Belgium) and Marco Zanni (5 Star Movement, Italy). They charge the giant systemic banks not only with being a rescue burden for the taxpayer, but also with being an obstacle to the real economy.

"The real enemies of the market economy are therefore BNP Paribas, Deutsche Bank and company." The original 2014 proposal of the EU Commission has been watered down more and more, and is completely useless, and benefits only the systemic banks, the three say.

"An effective separation of banks, however, would make the financial system transparent, orient it more towards the real economy and shield it against systemic risks," they write. "The clear separation of client-based core banking deals still being protected by the state, and of speculative trade deals which then would have to live without state subsidies, would be a gain for our national economy, our clients and tax payers. Furthermore, such a regulation would be less complex and would provide the supervisors more legal muscle against the smart lawyers of the mega banks as well as against the political pressure coming from Europe’s capitals. The Glass-Steagall Act under U.S. President Roosevelt, for instance, comprised a bit more than 30 pages, whereas the EU legislation on banks comprises thousands of pages."

"A real banking reform is still possible," the three authors state. "On May 26, Liberals and Conservatives lost the vote in the economics committee of the European Parliament, and the adoption of a watered-down version of the [EU] Commission’s proposal [of 2014] was prevented. Now, there will be new negotiations. We and our parliamentary groups will fight to gain a majority for a real reform."

In the Italian version of the text, the final sentence is addressed to members of the socialist camp to join the battle.