Discussion: Bernie Sanders Struggles To Explain How He Would Break Up The Banks

daveyjones64 · April 5, 2016, 8:53am

Well, that was a new response that we never heard…what? you say that Bernie repeats that response literally every time a question about the banks is raised? So it won’t be new when he says it yet again during the NY debate that he cried wasn’t happening, and then when giving a bevy of dates to choose from, tried to weasel out of?

Interesting…in the not very sort of way.

So, a follow up question, Mr. Sanders…in this “moral” economy, will you or won’t you release your complete tax returns for the past 10 years? Too busy still? Or will it still be Jane’s fault?

imkmu3 · April 5, 2016, 8:54am

Is Bernie promising a unicorn without knowing where unicorns come from?

365daysofhorror · April 5, 2016, 8:55am

Step 1: Wag finger
Step 2: ???
Step 3: Break up banks

luckybastard77 · April 5, 2016, 8:56am

I’m not trying to be mean, but this shouldn’t surprise anyone who’s been paying attention. TBH, that whole interview was just short of a disaster. When asked a question on details in a debate and your stock answer is “political revolution”, it should raise some red flags. The interview reinforced what I think about Bernie Sanders. He’s very good with diagnosing the symptoms of the problems. I think he’s more spotty with the causes of them and is clueless about the processes involved in rectifying. I think it’s best he stays in the Senate.

imkmu3 · April 5, 2016, 8:59am

Because as you know, we want clueless people in the Senate as well.

ronbyers · April 5, 2016, 9:04am

While Bernie is great at articulating the problem in a way the average person can appreciate, he is not very good at explaining how he will solve it without resort to magical incantations. Just the opposite of Hillary who is great at getting things done within but doesn’t really want to change the existing reality all that much. I wish we had someone who is both a big thinker and a big doer, but they are rare and very scary. Maybe that is why we don’t have giant leaders on big white horses all that often.

ignatius_donnelly · April 5, 2016, 9:26am

Well, that was a pretty dispiriting exchange. And really, it’s not such a hard question: there is a long history of anti-trust enforcement that shows how to break up a large corporation. Given that this is a centerpiece of Sanders’ campaign, I would have expected him to be able to talk about it, at least.

If the banks were to be broken up, the editorial board asked, what would happen to the hundreds of thousands of employees who would be affected?

How could he let a ridiculous claim like that go unchallenged? If a big bank is required to divest assets - which is all a break-up has to involve - it would do so by selling them to smaller banks. For the great majority of those “hundreds of thousands” of employees, the only thing that would change is the name on the branch office that employs them. Instead of pointing this out, Sanders retreats to blather about a stronger economy making everything all right.

Sanders comes across - not for the first time - as a pure insurgent, entirely uninterested in any of the policy details his ideas would require. There is a valuable role for this kind of politician, but it’s not in the White House.

rb639 · April 5, 2016, 9:07am

So I guess Sanders read “Small Is Beautiful” and has been using it as a textbook for his economic thinking. As an erstwhile adherent to this view, I remember how shocked I was when my husband referred to it as “Small Is Stupid.” But it’s not small that is stupid, it is the insistence that we formulate policy merely because it appeals to someone’s vision of what they want America to be like, especially when that vision seems to have been set in stone somewhere around 1952.

musgrove · April 5, 2016, 9:11am

He has been talking about breaking up the banks for how long now… and this is his response…

Reminds me of Trump talking about his wall

brooklyndweller · April 5, 2016, 9:13am

If the banks were to be broken up, the editorial board asked, what would happen to the hundreds of thousands of employees who would be affected?

“What I foresee is a stronger national economy. And, in fact, a stronger economy in New York State, as well. What I foresee is a financial system which actually makes affordable loans to small and medium-size businesses,” Sanders responded.

This answer is so horrifying in its cluelessness. He doesn’t actually answer the question of unemployment of all those people affected. He just spits out the bromide of a supposedly stronger economy. How those people find other jobs just isn’t on his radar.

And on the point of loans, he’s dead wrong. I say that because I remember back in '09 banks of all stripes were NOT giving their smaller business customers loans. These businesses were furious because they needed the loans to cover things like payroll, purchases, etc. The banks flat out refused because they were holding onto every penny they could. Instead, what they did was to give these small business customers credit card lines to draw down on. The banks held onto as much cash as they could to prop up payments to shareholders. They aren’t connected to the economy as a whole.

luckybastard77 · April 5, 2016, 9:13am

I think that he’s brought a lot of issues to the forefront that he’s proven to be a good messenger for. I think this role suits him very well in the Senate since he’s got Elizabeth Warren, Sherrod Brown, Al Franken, and hopefully next term, Donna Edwards. They can do a lot of good work there as the progressive wing of the Dems.

rb639 · April 5, 2016, 9:15am

Yes, I agree, the natural response was to point to antitrust enforcement, but it’s wrong for someone (like Sanders or you) to assume that the new owner will be just like the old owner; that they will find a need for certain types of business assets or employees.

westcoast · April 5, 2016, 9:16am

I read the complete interview yesterday afternoon. I was shocked that the Observer pressed him on the details of various plans particularly the banks. Many of us have been asking the same questions “HOW” are you going to break up the banks, how are you going to implement your “medicare for all”, how are you going to implement free college tuition for state schools funded by state government.
During the endless debates we have hac Sanders repeat over and over again that he will achieve these goals through his “revolution.” But it has taken this long for for the media to ask “HOW.”

musgrove · April 5, 2016, 9:16am

Sherrod Brown and Al Franken are both Clinton backers, Warren hasn’t endorsed either yet.

luckybastard77 · April 5, 2016, 9:19am

I’m aware that they are either with Clinton or haven’t declared. I was talking about when he’s back in the Senate, that, along with those people, they’ll have a very strong progressive wing there and they can build on the issues that he’s brought increased attention to during the campaign. Before he thought he could win, I believe this was his plan anyways. He never thought he’d get as close as he did and be subject to the scrutiny he is under now.

musgrove · April 5, 2016, 9:20am

If he wants to join the boat of the other senators passing things when Dem’s retake the senate thats fine, but i don’t see him as a leader in that process.

jsfox · April 5, 2016, 9:24am

“How could he let a ridiculous claim like that go unchallenged? If a big bank is required to divest assets - which is all a break-up has to involve - it would do so by selling them to smaller banks. For the great majority of those “hundreds of thousands” of employees, the only thing that would change is the name on the branch office that employs them. Instead of pointing this out, Sanders retreats to blather about a stronger economy making everything all right.”

First the concept of breaking up the big banks at least as Bernie describes it means getting them out of the investment business not selling off branches. You know reintroducing a Glass–Steagall type act. This would mean closing down entire divisions of the banks. So yes 1000s of employees would probably lose their jobs. Will it be 100s of thousands? that I cannot answer.

Sheerod Brown’s approach though is the better one.

His “legislation would place sensible limits on the amount of debt that a single financial institution could take on relative to the entire productive economy. No bank could have non-deposit liabilities valued greater than two percent of U.S. GDP, and no investment bank could have non-deposit liabilities exceeding three percent of GDP. This would only affect the six largest megabanks, which would be given three years to comply by drawing up their own proposals to meet this goal.” http://www.washingtonmonthly.com/political-animal-a/2014_12/what_does_breaking_up_the_bank053410.php

This would still mean a lot of folks would probably lose their jobs.

westcoast · April 5, 2016, 9:24am

The disruption in an industry as to the future of the employees affected by said disruption is not so easily dismissed as to say they will be shuffled to smaller entities. We have no idea - and certainly Sanders has no clue- as to the consequences or the manner in which these “breakups” would occur. It is easily said and difficult to implement. There will be winners and losers in any effort to achieve his “goal”.

luckybastard77 · April 5, 2016, 9:25am

I think Warren will be the leader in the Senate for the progressives, if not majority leader at some point in the next few years. But even though I’m not voting for him and thinks he’d be a terrible president, I don’t discount the fact that he’s earned millions of votes that mount to over 40% of the voting Democrats in the primary.

rb639 · April 5, 2016, 9:25am

It’s also the automatic response given by people who are advocating for international trade deals – that because the whole economy will be stronger we don’t need to give any thought about disruption to the “losers” in any individual capacity. If you find the explanation unsatisfying in the trade arena (I think it has been incomplete, at best) then you should find it unsatisfying here.