Are you ready for a big surprise?

Neel Kashkari is president of the Federal Reserve Bank in Minneapolis.  He worked for Goldman Sachs and was appointed by George W. Bush to work in the Treasury Department. He ran for governor of California as a Republican. He is now calling for break up of ‘too big to fail’ banks in the United States.

Kashkari warns that right now, if there was a sudden economic crisis, the government would have to bail out Wall Street yet again. He says that is unacceptable, and wants everyone—across the political spectrum—to get behind the effort to change the ‘too big to fail’ status quo immediately.

Banks he names are  JPMorgan, Goldman Sachs, Bank of America and Citigroup.

“We’re launching a research program to bring experts from around the country, who have serious proposals. The proposals include breaking up the banks into smaller, less important entities, putting so much capital in the banks that you regulate them like a nuclear power plant, turn them into a utility, so they almost virtually cannot fail, or even taxing leverage so that if the risks move from banks to nonbanks or insurance companies, that you can capture that wherever it goes. There are transformational solutions out there that in my view have not been given serious consideration.”

Attached is the audio, from an interview conducted by NPR.

This is part of the February 12, 2016 online edition of The Mountain Enterprise.

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