"Government is Not the Answer." How many times have we heard that line roll off the tongues of some right-wing Republican? Nauseatingly way too often. Phil Gramm said it too. But first here's the latest story from CNN Money, Why you can't get a loan. It's "the banking crisis" of course. If it weren't so serious, one might have to laugh about the self-inflicted, shoot yourself in the foot 'crisis' which the banking industry brought about- with the help of the Republicans in Congress. They did it with eyes wide open, waiting for the money to roll in.
Naturally, they had the GOP firmly on their side as Congress passed The Gramm-Leach-Bliley Act. Former senator Trent Lott loudly praised the bill saying on the floor of the Senate,
"When the history is written of this session of Congress, it will probably identify this piece of legislation as the single biggest achievement. I have heard this financial services modernization issue discussed for my entire career in the Congress, which is now up to 27 years. It has been tried by Republicans, by Democrats in the Congress, House and Senate, administrations of both parties. It never quite occurred."
When the history is written... It has been, senator, and it ain't too good.
Phil Gramm, the chief sponsor of the bill and economic adviser to candidate John McCain, said at the signing ceremony,
"We are here today to repeal Glass-Steagall because we have learned that government is not the answer. We have learned that freedom and competition are the answers. We have learned that we promote economic growth and we promote stability by having competition and freedom.
"I am proud to be here because this is an important bill; it is a deregulatory bill. I believe that that is the wave of the future, and I am awfully proud to have been a part of making it a reality."
'Awfully proud,' he said. It is a 'deregulatory bill.' Indeed, senator, indeed it was! Those damned government regulations! Too much government interference in business!
We ought to hang Phil Gramm from a tree in front of Capitol Hill in a nationally televised event. It would be cathartic for us, although it will not recover the 30 trillion dollars that has evaporated from the banking system.
Prior to its passage, Gramm made daily appearances in the well of the Senate, giving speeches on how wonderful the bill would be for the citizens of this nation. In October 1999, he said,
"The financial services modernization legislation is the most important banking legislation in 60 years. The people it will benefit most are working families.
"The hallmark of the bill is that it will make an array of financial services available to every American consumer that will provide lower prices and one-stop shopping at financial supermarkets in every city and town in the country."
'One-stop shopping at financial supermarkets,' he said. No more stuffy bank buildings; no more scrutiny of assets; none of that old-style stuff that kept banks afloat since the Glass-Steagall Act of 1933, enacted after the Hoover Depression to insure the safety of savings and loans. No, none of that 'safety' stuff, senator. Let's experiment with risky loans, eh? Let's create a new kind of bank- one that isn't bound by those foolish rules and regulations of the past. Investment banks! Now there's the answer, right Senator Gramm?
Is it any wonder, then, that John McCain uttered those infamous words, "The fundamental of the economy are strong!" After all, it was Phil Gramm who was giving him financial counsel.
Right after the Senate approved the bill, Senator Gramm took to the floor to praise the legislation. He said,
""The Gramm-Leach-Bliley Act strikes down these walls and opens up new competition. It will create wholly new financial services organizations in America. It will literally bring to every city and town in America the financial services supermarket."
May I offer an amendment, senator? Could we substitute this final line instead of yours:
"It will literally bring to every city and town in America to its knees!"