Matt Taibbi: Break Up the 'Too-Big-to-Fail' Financial Behemoths that Destroyed the Economy
Editor's note: This week, finance industry journalist Matt Taibbi put together a list of five political demands Occupy Wall St. protestors could agitate for. First on his list was the breakup of the "too-big-to-fail" financial institutions holding the global economy hostage. In the following transcript from "Countdown with Keith Olbermann," Taibbi elaborates on how to break up the financial behemoths that sunk the economy.
Taibbi: First of all, nobody asked my advice on any of this and they're doing great without the advice of people like me. But ...
Olbermann: It's a democracy, everybody has a voice, take your platform.
Taibbi: Everybody has a voice. But there are a lot of people who have been following this whole issue of Wall Street corruption for years. There's a small community of those people and we've been talking amongst each other for the past few weeks -- trying to think about, what would the demands be? What would a good demand be if it came time to make one?
And the one thing everybody can agree on is that you have to break up the too-big-to-fail companies. You gotta go in and get rid of those companies because they're above the law and above the market. They have the implicit support of the United States government, which is a disastrous, deadly situation for everybody. So that's thing one, and that's something they could actually get to --
Taibbi: A movement to --
Olbermann: What Congress in our America of 2011 would ever approve that? They would be kidnapped and you'd never find the bodies, they'd be kidnapped by their corporate owners.
Taibbi: I know, it's true, it does sound outlandish, but --
Olbermann: Do you think the people we appointed to replace them would pass this?
Taibbi: But you know, there was an amendment during the Dodd-Frank bill, you know the Brown-Kaufman amendment to break up these companies that got 33 votes in the Senate. Thirty-three isn't 50, 33 isn't 55, but everybody in Washington understands that these companies are a problem. Obviously they have an enormous amount of political power so actually breaking them up is a huge practical problem. But there's support there. If there was a big enough show of force on the streets, commensurate, for instance, with the Tea Party, I think they would have a chance starting it back in the other direction.
Olbermann: Given how the American political system essentially folded at the sight of a few hundred people at the time wearing funny hats, you may have a point. The one advantage of a weak-limbed, jelly-spined, political system is that you can scare it from either direction, it doesn't just have to be from a conservative or pro-corporate one.
Taibbi: Absolutely. And it has the additional advantage of being the right thing to do. Obviously that's not usually a motivating factor for our Congress but you know, when the chips are down, that does tend to be a slight motivating factor.
Olbermann: But, don't the banks have to decide how the bankers get paid?
Taibbi: Yes, they do, and obviously that's something that's going to be more of an industry-wide reform, it's not something you can really do from the outside.
Olbermann: Could you say, do this or we're nationalizing the banks? (laughs)
Taibbi: Exactly. All of these companies are essentially wards of the state right now. If we really wanted to we could dicate to them almost anything. We can have them all fired, or all their executives removed. If you want all this bailout money, if you want public support, if you want to keep borrowing from the discount window at zero percent, here are the things that you have to do
If there was the political will, we could do that. We could tell them, you can't collect bonuses up front, for investments that might blow up later that we have to bail out. And I think that's a logical step that Wall Street has to take.