January 01, 2010 10:17 PM UTC

How to fix our financial system

•  
• by: DavidThi808

As Danny has said (and I agree), this is the #1 national security issue. And as Ariana Huffington (and others) have pointed out – right now the Dems have given Wall St everything they asked for – and told the rest of us to go piss up a rope. So Dem re-election depends on addressing this.

Raw geopolitical power comes from the strength of the economy and the ability to borrow, not the barrel of a gun. It was true when wars were fought on the battlefield (Civil War, WWI, WWII). And it’s true today where a better quality of life is the best argument against terrorism.

So how do we address this? Here’s my 6 suggestions…

1. Create the financial consumer protection agency.
2. Break up To Big To Fail (2B2F) banks. We limit mergers all the time because it would create a monopoly – we should be able to do the same where it endangers the existence of the country.
3. Create a 1% transaction tax on all financial transactions. That will reduce a lot of the short term betting as the tax is greater than the profit (this is a good thing). And as no one complains about a sales tax reducing the sales of a cup of coffee – why do stock sales get an exception? (Sell this as the tax is to pay for the costs of the recession – they caused it – they get to cover it.)
4. All financial paper goes through an exchange. Every single one. Create a miscellaneous exchange for “other” but anything over say 1 million goes through an open public exchange.
5. Bring back Glass-Steagall.
6. Full information about all holdings of financial (all, not just banks) over a certain size is to be public, live, and complete. Then challenge Google, Yahoo financial, Microsoft, Oracle, etc. to come up with systems to measure and grade that info.
7. Full information from the federal agencies too. What they are doing, why, what guarantees they have out, etc. It’s our money and so we have a right to know what they are doing with it.

The other thing I would suggest is don’t roll all this into one gigantic bill. Congress builds these monstrous bills and they then take forever and require so much trading that they get watered down and have tons of pork added.

Instead create 7 simple single-topic bills and move each forward quickly and on it’s specific merits. That also forces Congress to vote up/down on each item rather than finding one single item in the bill as their excuse for the entire thing.

Question 1 – does this make sense?

Question 2 – if so, can it get passed?