Restore Glass-Steagall

[Selatius]

57. Easy, require it be a joint-venture or a partnership between said entity and the parent company.

In this manner, you're not going for the hardline stance under Glass-Steagall and requiring that the bank truly spin-off its banking activities from its investment activities, but at the same time, you're still establishing a firewall between the two in order to avoid conflicts of interest. Even if the parent or partner company made risky speculative bets and lost big in its investment wing, the banking wing would have leverage in as much as it can easily claim under joint-venture or partnership regulations that it isn't responsible for any liabilities arising from its partner company's failures or willful incompetence.

For example, if I wanted to build cars in China, I would likely form a joint-venture with a Chinese firm and split the profits in such a firm. There would be the partner firm, my firm, and the firm that is the joint-venture between the two of us. If the partner firm takes on large liabilities, such as massive investments in new infrastructure or research and development, the joint-venture itself wouldn't be on the hook if the partner firm has trouble making its bills. The only thing that would become a problem is if the partner firm goes into bankruptcy or out of business entirely, in which case the joint-venture would have to be dissolved seeing as the other half of the venture no longer exists. Of course, that's a worst case scenario, but this isn't 2008/2009 anymore.

Ideally, I'm on your page. Just put back Glass-Steagall; I have no problem with this route; it's the simplest one, but given the level of corporate money influencing the Senate agenda and elections in general, I think it would be a very difficult long-shot at best to get it reinstated in full, hence the compromise solution. The hurdles in the Senate are also why I favored the Public Option with respect to health care reform, as opposed to a far simpler and more cost-effective Medicare For All bill. There's too much money in opposition to the common sense, easier solution. So, we have to do things in a roundabout way. Such is the nature of a corporatized government.