Banking Industry Launches Systematic Campaign to Erode Glass-Steagall Act

Large commercial banks launch a coordinated, multi-pronged campaign to systematically dismantle the Glass-Steagall Act’s financial regulations. This strategic effort involves regulatory capture through administrative reinterpretations, academic influence to discredit Depression-era banking safeguards, and sustained legislative pressure for formal repeal. The campaign represents a fundamental shift from New Deal financial protections toward aggressive financial deregulation, driven by banks’ claims of reduced global competitiveness.

Key strategies include:

• Lobbying federal regulators, particularly the Federal Reserve
• Establishing securities trading subsidiaries
• Funding academic research challenging existing banking restrictions
• Arguing that US banks were becoming globally uncompetitive due to strict regulations