The act in question eviscerated the Glass-Steagall Act of 1933, the most important piece of legislation that restored stability to the financial markets after the Crash of 1929. Glass-Steagall had separated commercial banks, which try to make a small profit investing the savings of ordinary working-class people, from investment banks, which gamble for high stakes using other people’s money. Following the deregulatory siren song of Ronald Reagan, Phil Gramm and his dupe Jim Leach wrote a law that allowed commercial banks to do exactly what had caused the 1929 crash. They thought we were smarter and would not make the same mistake twice. Fools do not learn from history’s mistakes, and are doomed to repeat them.
I don’t care what wonderful things Jim Leach is doing now. Until he writes a convincing article explaining his current understanding of what was wrong with Gramm-Leach-Bliley, he is just another self-serving Republican politician, and I will give him zero credibility.