http://www.pbs.org/moyers/journal/03262010/profile.html
In the synopsis of this PBS interview that follows, Morgenson, who first began writing about Wall Street's excessive risk taking well before the last crisis, doesn't believe the major bills currently before Congress do enough to regulate Wall Street. As she tells Bill Moyers, "I think that the bills that we have seen thus far are half-baked and really don't address some of the crucial elements of reform that are needed if we want to prevent this kind of crisis from happening again."
One of the main issues for her is allowing banks to grow "too big to fail" -- a size so big that they present a risk to the entire economy. To reduce the size of banks, Morgenson says, "You have to increase capital requirements. You have to increase the cost of doing business for these entities if they grow too big. Then put the money they pay into an FDIC-type insurance fund."
However, getting meaningful reform is often easier said than done in Washington, where lobbyists far outnumber legislators, and many legislators rely on wealthy industries, especially the financial industry, to fund their campaigns.
Last November, the Center for Responsive Politics (CRP) published a seven-part series on the power of the financial services lobby, "Crossing Wall Street." Since 1989, they report, the finance, insurance and real estate sector has been the largest single contributing sector to Congressional campaigns -- contributing $2.3 billion in that period. As the report notes, "Despite a moribund economy, the financial industries that have enjoyed relatively little regulation over the years continue pouring big money into making sure the government's control over them remains limited." Since the beginning of 2009, the finance, insurance and real estate sector has spent more than $500 million on lobbying and campaign contributions. www.OpenSecrets.org.
Two years ago this month the financial giant Bear Sterns collapsed and Wall Street began to unravel, wiping out millions of jobs, driving millions of people from their homes, and plundering once healthy pension plans. And all this time later there is still no reform from Congress, to prevent the reoccurrence of such a tragedy. A crippled little bill seems to be hobbling out of the wreckage but still faces an array of well-armed forces gunning for it.
And that's no surprise. In the two recent election cycles, members of the Senate Banking Committee received more than $39 million from Wall Street and the banks, while members of the House Financial Services Committee raked in more than $21 million. So just how serious do you think these members of Congress are going to be about true reform?
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