In 2018, when Donald Trump was president and Republicans ran the House and Senate, Congress passed the Economic Growth, Regulatory Relief, and Consumer Protection Act. Among other things, it raised the “too big to fail” threshold from $50 billion in assets to $250 billion. This directly allowed these smaller banks to start messing with your money.
The banking industry had been lobbying for years to pass this, but had to find the right time politically to get it through. Their effort included courting just enough Democrats from red states, plus unified Republican support. And it worked, passing the House and the Senate.
Not everyone at the time was convinced. “In 2018, I rang the alarm bell about what would happen if Congress rolled back critical Dodd-Frank protections” said Warren. “Banks would load up on risk to boost their profits and collapse, threatening our entire economy—and that is precisely what happened.”
On Friday, April 28, just days before First Republic Bank’s demise, the Federal Reserve issued a scathing report about its own failure to predict or prevent the failure of Silicon Valley Bank and Signature Bank. The report identified lax oversight and the bank’s collapse demonstrated “weaknesses in regulation and supervision that must be addressed.”
This is why we must redouble our efforts to pass the Secure Viable Banking Act—sponsored by Warren, Rep. Katie Porter of California, and dozens of other Democratic lawmakers. This crisis cries out the need to hold banks accountable, because it’s our money after all.
If your member of Congress was right in 2018, wrong in 2018, or had not yet been elected, they need to hear from constituents today that we do not want banks gambling with our money. We need tougher oversight and regulation to stop banks from behaving badly.
Sign and send the petition to Congress: Pass the Secure Viable Banking Act.
