Senators propose caps on bank size
Politico – A handful of liberal Democratic senators are pushing a sweeping banking proposal that would cap the size of banks in an effort to keep them from becoming "too big to fail."
Sen. Sherrod Brown (D-Ohio) said early Wednesday morning that a $50 billion dollar fund designed to liquidate failing financial firms is not sufficient and is diverting attention from a more significant problem: banks getting to the brink of collapse in the first place.
Brown and several other Democrats want to take a much more dramatic step: capping banks so they cannot hold liabilities of more than 2 percent of the national GDP or 10 percent of total insured bank deposits in the country. This step would only apply to three major banks: Bank of America, Wells Fargo and JP Morgan Chase.
"We want limits on the size of banks," Brown said. "The issue is not how to resolve banks that are too big to fail—that needs to be addressed, it needs to be done right whether it's $50 billion, whether it's $100 billion, whether it's other kinds of ways to do the resolution of too big to fail. But the major issue is to keep the banks from getting too large to begin with, both the deposit banks and the non-depository banks."
