Senate votes in favor of Wall Street (Huffington Post)

A move to break up major Wall Street banks failed Thursday night by a vote of 61 to 33.

Three Republicans, Richard Shelby of Alabama, Tom Coburn of Oklahoma and John Ensign of Nevada, voted with 30 Democrats, including Senate Majority Leader Harry Reid of Nevada, in support of the provision. The author of the pending overall financial reform bill in the Senate, Banking Committee Chairman Christopher Dodd, voted against it. (See the full roll call.)

The amendment, sponsored by Sens. Sherrod Brown (D-Ohio) and Ted Kaufman (D-Del.), would have required megabanks to be broken down in size and capped so that their individual failure would not bring down the entire system.

Under Brown-Kaufman, no bank could hold more than 10 percent of the total amount of insured deposits, and a limit would have been placed on liabilities of a single bank to two percent of GDP.

In practice, the amendment required the six biggest banks -- Bank of America, JPMorgan Chase, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley -- to significantly scale down their size. It was touted as a way to end Too Big To Fail.

Though top Obama administration officials have not publicly opposed the amendment, its leading economists have opposed ending Too Big To Fail simply by breaking up the nation's financial behemoths. Austan Goolsbee and Larry Summers have both fought back against this idea, as has Treasury Secretary Timothy Geithner.

"This is certainly a defeat for those who are concerned about the dangers of financial concentration in this country," Kaufman said in a statement after the vote. "Some causes are worth fighting for, and for me, the concern about the risks 'too big to fail' banks pose to the American economy and people is deep and profound given the economic tragedy millions of American have endured. I believe the debate itself -- though failing to gain a majority of votes -- has helped to change attitudes about the degree of financial concentration and power these megabanks now represent."

The banks owned by the four largest financial firms in the U.S. collectively account for about 45 percent of all assets in the U.S. banking system, according to a HuffPost analysis of Federal Deposit Insurance Corporation data.

Those four megabanks collectively hold about $7.4 trillion in assets, according to the most recent regulatory filings with the Federal Reserve. That's equal to about 52 percent of the nation's estimated total output last year.

The top 12 banks in the U.S. control half the country's deposits. By comparison, it took 25 banks to accomplish this feat in 2003 and 42 banks in 1998, according to a Jan. 4 research note by Jason M. Goldberg of Barclays Capital.
Link to complete Huffington Post article


Link to Roll Call-check out how your representative voted


Grandpa sends a special recognition to the following Nay voters for yet again displaying the epitome of hypocrisy and complete indifference to our grandchildren.

Max Baucus (on the topic of additional extensions of unemployment: “You can't go on forever”, appears Wall Street Banks are entitled to go on forever, also voted yea to repeal Glass-Steagall in 1999)

Susan Collins (talked tough when grilling the Goldman Sachs boys and rolls over when she is not on TV…she also voted yea to repeal Glass-Steagall in 1999)

Chris Dodd (Financial Reform Bill Would Stop Goldman-Style "Shenanigans". It is time to clean out your bong Chris… also voted yea to repeal Glass-Steagall in 1999)

Amy Klobuchar (5/5/10: “for far too long Wall Street has been running wild and its time for the government to step up its policing to reign them in”)

Chuck Schumer (“It's not just Wall Street that needs reining in”. also voted yea to repeal Glass-Steagall in 1999)