O’Malley seizes on Glass-Steagall

Former Maryland Gov. Martin O’Malley on Thursday challenged the Democrats running for president to embrace a new version of the Glass-Steagall Act, highlighting a difference between himself and the frontrunner for the party’s nomination, Hillary Clinton.

{mosads}Speaking in Washington at a forum hosted by former Rep. Brad Miller (D-N.C.), O’Malley never mentioned any other candidate by name, but he called on all of the Democrats running for president to commit to Wall Street reform that includes a new version of the act. 

“We made a commitment to the American people that we’d follow through on Wall Street reform, and we have not done that yet,” O’Malley said. “Any Democrat running for president who expects to succeed in the general election I believe will need to make basic commitments … to pass a modern version of Glass-Steagall. 

“For 70 years we separated the speculative banking activities from the depository activities and it worked,” O’Malley said. “We need to return to our true selves and put in a modern version.” 

Sen. Elizabeth Warren (D-Mass.) has introduced a bill that would require big banks to split up their commercial and investment banking divisions. The law is popular among many liberals. Democratic presidential candidate Sen. Bernie Sanders (I-Vt.) said last week he supports Warren’s bill.

The original Glass-Steagall was repealed under former President Bill Clinton, and some proponents of the law say its repeal is partly responsible for creating the regulatory environment that led to the 2008 economic collapses. 

Some economists, as well as the Clintons, dispute that notion. 

Hillary Clinton last week gave a major policy address vowing to crack down on Wall Street, but a Clinton adviser says she has no plans to embrace bringing back Glass-Steagall. 

O’Malley’s support for the law could help him separate himself from Clinton. 

“O’Malley and Sanders have called for breaking up ‘too big to fail’ Wall Street banks and a restoration of Glass-Steagall, and we hope to see similar systemic reforms proposed by Hillary Clinton soon,” Adam Green, the co-founder of the Progressive Change Campaign Committee, said in a statement on Thursday. 

So far O’Malley has had no success gaining traction in the race. He’s stuck at 1 percent in the polls nationally, according to the RealClearPolitics average, and now trails former Sen. Jim Webb (D-Va.), who is at 2 percent. 

O’Malley has sought to differentiate himself by releasing detailed policy proposals on issues ranging from the climate, to immigration to financial reform that have been lauded by some liberals. 

“Progressives are looking for a race to the top among Democratic candidates on big, bold, economic populist ideas,” Green said. “Martin O’Malley was the first candidate to make criminal prosecution of Wall Street bankers a 2016 issue — and it’s been great to see a race to the top with Clinton and Sanders making bold statements in favor of accountability for bankers who break the law.” 

But so far, Sanders has been the candidate who has galvanized the liberal base and emerged as the primary challenger to Clinton for the nomination. 

On Wednesday, O’Malley said his executive experience as governor of Maryland is what sets him apart in the field. 

“That’s what differentiates me from everyone else running for president in the Democratic Party,” O’Malley said. 

O’Malley also challenged the other Democrats to embrace reforms that would close “the revolving door between regulatory agencies and Wall Street,” prevent “the architects of Wall Street deregulation from serving in key Administration positions” and impose stiffer criminal penalties on white collar workers who break the law.” 

“If you slap a bank robber on the wrist he’s going to keep robbing more banks,” O’Malley said. “The same is true if the person wears a suit.”