Sponsored by:
Senator SHIRLEY K. TURNER
District 15 (Hunterdon and Mercer)
SYNOPSIS
Urges Congress to reinstate Glass-Steagall Act.
CURRENT VERSION OF TEXT
As introduced.
A Senate Resolution respectfully urging the United States Congress to enact legislation to reinstate the Glass-Steagall Act in order to strengthen the financial system.
Whereas, The United States Congress enacted section 20 of the Banking Act of 1933, Pub.L. 73-66 (12 U.S.C. s.377 et seq.) (commonly referred to as the Glass-Steagall Act) in order to eliminate the speculative activities which caused the collapse of the banking system during the Great Depression; and
Whereas, The Glass-Steagall Act curbed speculative activities by erecting a firewall between commercial and investment banking; and
Whereas, Following the repeal of the Glass-Steagall Act in 1999, commercial banks were permitted to merge with investment firms, insurance companies, mortgage companies, and other financial services firms to form vast conglomerates; and
Whereas, The newly formed financial conglomerates began engaging in irresponsible financial practices and speculative activities which brought them to the brink of failure and contributed to the collapse of the housing market; and
Whereas, The collapse of the housing market helped trigger the worst recession since the Great Depression, which cost millions of jobs and hundreds of billions of taxpayer dollars to bailout financial conglomerates considered too big to fail; and
Whereas, The United States Congress enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub.L. 111-203 in response to the speculative activities and irresponsible financial practices which drove the economy into recession; and
Whereas, Although the purpose of the Dodd-Frank Wall Street Reform and Consumer Protection Act was to address the root causes of the recession, the law does little to separate commercial and investment banking; and
Whereas, The reinstatement of the Glass-Steagall Act is necessary to strengthen our financial system and to end the irresponsible financial practices and speculative activities that lead to the collapse of the housing market and the subsequent recession in 2008; now, therefore,
Be It Resolved by the Senate of the State of New Jersey:
1. This House respectfully urges the United States Congress to enact legislation to reinstate the Glass-Steagall Act in order to strengthen the financial system.
2. Copies of this resolution, as filed with the Secretary of State, shall be transmitted by the Secretary of the Senate to the Majority and Minority Leaders of the United States Senate, the Speaker and Majority and Minority Leaders for the United States House of Representatives, and each member of the United States Congress elected from this State.
STATEMENT
This resolution respectfully urges the Unties Stated Congress to reinstate the Glass-Steagall Act in order to strengthen the financial system. The Glass-Steagall Act was enacted to eliminate the speculative activities that caused the collapse of the banking system during the Great Depression. The Glass-Steagall Act curbed speculative activities by erecting a firewall between commercial and investment banking.
Following the repeal of the Glass-Steagall Act in 1999, commercial banks merged with investment firms and other financial firms to form vast conglomerates. The newly formed financial conglomerates began engaging in irresponsible financial practices and speculative activities that contributed to the collapse of the housing market and in turn lead to the worst recession since the Great Depression.
The United States Congress enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act to address the root causes of the recession. However, the Dodd-Frank Wall Street Reform and Consumer Protection Act does little to separate commercial and investment banking. The reinstatement of the Glass-Steagall Act is necessary to strengthen our financial system and to end the irresponsible financial practices and speculative activities that lead to the collapse of the housing market and the subsequent recession in 2008.