The godfather of "too big to fail" mega-banks has made a turnaround too big to miss.
Sandy Weill successfully lobbied Congress to tear down the walls between Main Street banks and Wall Street -- the safeguard established by the Glass-Steagall Act. He then proceeded to build Citibank into the financial behemoth Citigroup.
But now, after tens of thousands of progressives called for an end to the mammoth banks that Weill's lobbying helped create, Weill came out on national television against the very changes he had advocated, which helped create the "too big to fail" financial giants:
What we should probably do is go and split up investment banking from banking...Have banks do something that's not going to risk the taxpayer dollars, that's not too big to fail.
Of course, that is precisely what Glass-Steagall had done, and in doing so gave us more than a half-century without a significant financial crisis, laying the foundation for the most consistent economic growth in our nation’s history. When an original architect of "too big to fail" declares a need to end the system he helped create, we know our pressure is working. Now, we need to keep up the momentum.
Weill's about-face sent shockwaves through the financial world. But in the world in which you and I live, his new tune is the same song people like us have been singing for a long time.
These banks got so big that when their immensely risky investments went bust, they brought down our economy with them. And instead of demanding a return to the commonsense and time-tested Glass-Steagall law, President Bush and Congress just handed the banks big bailouts.
Progressives knew that was a bad deal, and we started fighting it. Now our fight is gaining traction with the consummate Wall Street insider. That means we need to press our solution hard enough for them to hear us on the rest of Wall Street -- and in Washington.
We should never let these behemoth banks hold our economy hostage again. It's time to end "too big to fail," and it's time to speak out.