Former Maryland Gov. Martin O’Malley kicked off a two-day swing through the early presidential state of Iowa by calling out both parties on Wall Street reform, saying most congressional Republicans are “hell-bent” on rolling back a 2010 law passed in the wake of the financial crisis while too many Democrats have been “complicit” in the “backslide toward less regulation.”
Mr. O’Malley argued in a piece for the Des Moines Register that while the 2010 Dodd-Frank financial reform bill “addressed inherent flaws in the financial system,” it “did not go far enough.”
He called for reinstating the 1933 Glass-Steagall Act to keep commercial banks separate from investment banks, writing that under Glass-Steagall, the country did not see a major financial crisis for nearly 70 years.
In 1999, former President Bill Clinton signed legislation passed by a Republican Congress rolling back provisions of the law.
“If that law hadn’t been repealed in 1999, the crash would have been contained,” Mr. O’Malley wrote.
Mr. O’Malley also called for breaking up larger banks into “more manageable institutions” and bringing in greater accountability.
“To this day, the Justice Department and financial regulators have done virtually nothing to bring criminal charges or hold leadership accountable,” he wrote. “Legal deterrents are critical for improving the culture of Wall Street and showing that fraudulent behavior will be punished.”
He said leadership should be replaced at banks that are repeat offenders and called for appointing people to positions — “attorney general and SEC chair for starters” — who will prosecute those who commit or permit crimes.
“Thus far, settlements have been nothing more than CEOs using shareholder money to buy their way out of jail,” he wrote.
He wrote that most Republicans in Congress are “hell-bent” on “disassembling” Dodd-Frank and that “too many Democrats have been complicit in the backslide toward less regulation.”
Some Democrats have been urging Sen. Elizabeth Warren of Massachusetts, lauded in some activist circles as an anti-Wall Street crusader, to enter the 2016 presidential contest on the Democratic side as an alternative to former Secretary of State Hillary Rodham Clinton, who is seen by some as closer to Wall Street.
But Ms. Warren has thus far rejected such pleas from activists, leaving an opening for Democrats like Mr. O’Malley to possibly emerge as a challenger to Mrs. Clinton, the presumptive frontrunner for the Democratic nomination.
“It’s time to put the national interest before the interests of Wall Street,” Mr. O’Malley concluded. “The future of our economy — and America’s middle class — depends on it.”