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K00369 Summary:

MLTSPNSRAbinanti, Barrett, Barron, Blake, Cahill, Colton, Crouch, Dickens, Dinowitz, Englebright, Fahy, Farrell, Galef, Glick, Gottfried, Jenne, Johns, Lavine, Lifton, Lopez, Lupardo, Magee, McDonald, Miller MG, Montesano, Mosley, O'Donnell, Perry, Santabarbara, Seawright, Sepulveda, Simon, Skartados, Thiele, Walker, Weprin, Woerner
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K00369 Text:

Assembly Resolution No. 369
BY: M. of A. Steck
        URGING the New York State Congressional delegation
        to  support efforts in the US House and US Senate to
        reinstate  the  Glass-Steagall  Act,  including  the
        separation  of  commercial  and  investment  banking
        functions in effect under  the  1933  Glass-Steagall
  WHEREAS,  An  effective money and banking system is essential to the
functioning of the economy; and
  WHEREAS, Under the American System policies of  Alexander  Hamilton,
such  a  healthy  banking  system  should provide credit to multiply the
productive manufacturing, agricultural,  infrastructure  platforms,  and
scientific ventures and activities of the nation; and
  WHEREAS, Such a system must function in the public interest, without
bias; and
  WHEREAS,  The  Federal  Banking Act of 1933, commonly referred to as
the Glass-Steagall Act, was written, as stated in its  introduction:  to
provide  for the safer and more effective use of the assets of banks, to
regulate interbank control, to prevent the undue diversion of funds into
speculative operations, and for other purposes; and
  WHEREAS, For 66 years -- from 1933, until it was taken down  by  the
Gramm-Leach-Bliley  Act  in 1999 -- the Glass-Steagall Act protected the
public interest in matters dealing with the regulation of commercial and
investment banking, in addition to insurance companies  and  securities;
  WHEREAS,  Under  the Glass-Steagall law, financial institutions were
considered "banks", and their depositors were protected,  only  if  said
banks  met certain criteria, and could not be involved in securities and
speculative instruments; thus protecting insured-deposit banks from  the
risk-taking of Wall Street trading firms; and
  WHEREAS,  The  Glass-Steagall  law created an absolute separation of
banks from investment houses, and  banned  any  financial  or  personnel
linkage  between  these  two banking sectors, and especially forbade any
loans from commercial banks  to  investment  banks  or  for  speculative
activities,  thus  establishing  a  true  firewall,  so  strong that the
commercial  banks  and  the  real  economy  were  not  affected  if  the
investment  banks  collapsed,  and  no  bank  was considered "too big to
fail"; and
  WHEREAS, The Glass-Steagall Act was repealed in 1999, allowing banks
to use personal investment to speculate in the market,  contributing  to
the  greatest speculative bubble and worldwide recession since the Great
Depression of 1933; and
  WHEREAS, The worldwide recession of 2007-08 left millions  of  homes
in  foreclosure;  millions  of  jobs  were  lost nationwide; and has put
severe financial strains on states, counties  and  cities,  exacerbating
unemployment and stressing the social services systems; and
  WHEREAS,  Many  of the financial industry entities were "bailed out"
by the United States Treasury at a  cost  of  hundreds  of  billions  of
dollars  to  US  taxpayers,  and  were  also granted "equity infusions",
"asset guarantees",  and  "below-market  rate  loans  from  the  Federal
Reserve"; and
  WHEREAS,  Despite  the  cost  of these bailouts, and the transfer of
savings from American citizens,  and  despite  implementation  of  other
policies, financial instability has grown, such that the five major Wall
Street banks are now, in 2016, larger than in 2008; and
  WHEREAS,  The American taxpayers continue to be at risk for the next
round of bank failures; and
  WHEREAS, The preferential financial support given to these "too  big
to fail banks" has stayed in the financial sector, and has not increased
needed credit into the real economy; and
  WHEREAS,   The   call   to  reinstate  Glass-Steagall  has  received
widespread national support  from  prominent  economic,  banking,  farm,
labor,  academic, legislative and business leaders from all parties, and
many of the major and respected national newspapers; and was included in
the party platforms of both major parties in 2016; and
  WHEREAS, The United States Senate and House of Representatives  have
been  making  efforts  to  restore the protections of the Glass-Steagall
Act, and currently in the 115th Congress, Representatives  Marcy  Kaptur
(D-OH) and Walter Jones (R-NC) have co-sponsored H.R. 790, together with
a total of 26 original co-sponsors, including three from New York State;
and  in  the  114th  Congress,  four US Senators introduced S. 1709, the
"21st Century Glass-Steagall Act of 2015"; now, therefore, be it
  RESOLVED, That this Legislative Body pause in its  deliberations  to
urge  the  entire New York State Congressional delegation to support and
enact  in  Congress   the   legislation   that   would   reinstate   the
Glass-Steagall   Act,   including   the  separation  of  commercial  and
investment banking functions that were in effect  under  Glass-Steagall,
thus  securing  a  safe  American  banking  system,  which  can  protect
deposits, and supply needed credit for  a  productive  economy,  protect
state  finances  and  the  well-being  of  our  citizens, and remove any
national protection of investment in stocks, underwriting of  securities
or  investing  in  or acting as guarantors to derivative transactions or
other activities deemed "non-bank" activities under  the  Glass-Steagall
law; and be it further
  RESOLVED,  That  copies  of  this Resolution, suitably engrossed, be
transmitted  to  each  member  of  the  New  York  State   Congressional
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