British Banker, Former MP, Issues Strong Call for Glass-Steagall
Feb. 4, 2017 (EIRNS)—John Browne, a banker who was a Conservative Member of the British Parliament (1979-92) and later a Vice President in the U.K. Independence Party (UKIP), was interviewed on Fox Business News on Friday, strongly identifying the take down of Glass-Steagall as the cause of the current disaster and calling for reinstatement in the United States, the United Kingdom, and elsewhere. A loose transcript:
"At the root of the crisis is that America abolished Glass Stegall, when banks, which had to be secured for their depositors, began to get involved in investment banking, getting them into highly speculative instruments. I think that the reintroduction of Glass-Steagall, which separated banks from investment banks, should spread to Britain and other countries.
"It takes speculation out of banking, and hence the need for government to stand behind them with taxpayer’s funds, which leads of course to more speculation, gambling with clients’ money, and leads to taxpayer bailouts, and more huge profits at these banks.
"The prices on banks are so high today because they reflect these exotic instruments which have such high returns. Getting back to dear old banking will be tough on earnings, so it is not popular, but it is the only solution."
Asked by Fox if another crisis like 2008 is in the works, Browne responded:
"Oh, yes. You see all this gambling—billions and trillions of dollars get wiped out. It is disastrous for families. There has to be a strict division of these industries. I’m for deregulation, but the crisis is entirely due to the fact that Glass-Steagall was abolished."