Can the minority sometimes be right?
In life, should one maintain a narrow focus and stick to one’s own field, leaving the rest to the so called experts? Or should one have a broader outlook, as one can often learn from the mistakes of others.
Should we be concerned with something that happened in the USA? What was the Glass-Steagall Act anyway?
In 1999 the US Senate voted to pass Gramm-Leach-Bliley
Act by a vote of 90-8.
Justin Lane, New York Times
Bill Clinton Signs the Gramm-Leach-Bliley Financial Services Act
It reversed what was, for more than six decades, a framework that had governed the functions and reach of the nation's largest banks (Glass-Steagall Act ). As a result, banks are no longer limited by laws and regulations: commercial and investment banks can now merge. Many have already begun the process, including, among others, J.P. Morgan and Citicorp. Banks can now sell insurance and stock. Nearly $300 million was spent to lobby the Senators.
Before 1999, Congress had tried 11 times to repeal Glass-Steagall and failed. Senator Byron Dorgan from North Dakota was one of the dissenters, and Newsweek took up the story:
“North Dakota Sen. Byron Dorgan expressed his fear of ‘exotic new derivatives called swaps way back in 1994. Five years later, when Congress passed legislation lowering the barriers between brokerages and banks, Dorgan told The New York Times, ‘I think we will look back in 10 years' time and say we should not have done this.’ It's been 10 years, and Dorgan was dead-on.”
Bloomberg had more details on Obama’s view:
“Obama himself has decried the way Glass-Steagall was undone, saying it left a regulatory vacuum that contributed to the current crisis.
“A regulatory structure set up for banks in the 1930s needed to change,” then-candidate Obama said in a March 27, 2008 speech at New York City’s Cooper Union. “But by the time the Glass-Steagall Act was repealed in 1999, the $300 million lobbying effort that drove deregulation was more about facilitating mergers than creating an efficient regulatory framework.”
“Obama referred to a campaign by companies such as Citigroup Inc., Merrill Lynch & Co. and Aetna Inc. in the late 1990s to overturn the law. Its demise allowed banks, insurance companies and securities firms to integrate and compete with one another.”
“Citicorp, a commercial bank, and insurance company Travelers Group Inc. announced a merger in 1998 that needed Glass- Steagall’s repeal to become legal. The combined entity became Citigroup.”
That actually happened before the Act was repealed!!!
“As commercial banks sought to compete with investment banks, they took bigger trading risks and created off-balance-sheet financing vehicles to help reduce the capital they needed to hold to protect against loan losses. Investment banks became more aggressive in lending to companies and increased their own borrowing to buy securities or real estate.
And the bottom line:
“Phil Gramm, a Republican senator from Texas who co-authored the Gramm-Leach-Bliley Act that repealed many key provisions of Glass-Steagall, later went to work for UBS AG, the Swiss bank whose foray into investment banking contributed an 88% drop in its shares since June 2007. Robert Rubin, a Clinton administration Treasury secretary who advocated Glass-Steagall’s repeal, went on to work for Citigroup, which lost $27.7 billion in 2008 and has needed $45 billion in government funds to remain solvent.”
The parallel with the current lobbying for the reform of the NHS is not difficult to see. Can we not see the danger? The “who is behind what support group” is not transparent and there are only a few of us who sense the hidden agenda enough to vocalize our concerns. The “big boys” are moving in and the MPs that are the likes of the US Senators Gramm and Rubin are now working for the privatization of the NHS by stealth. Watch out for their tactics!
“In England's health service creeping privatisation is turning into a full-frontal assault as the government strains every nerve to give health corporations a bigger slice of the action: not only in buildings and maintenance, but diagnostics, elective surgery, GPs' surgeries, district nursing, health visiting and trust commissioning – regardless of the views of staff and patients; the evidence on cost, inefficiency and lack of accountability; and the corrosive impact on the NHS ethos.”
This is scary, very scary.
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