'This Week' Transcript 3-19-23: Former Vice President Mike Pence and Sen. Elizabeth Warren
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Good morning. Good to be with you.
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Well, if I can, let me describe what I see as the problem. Starting back in 2016 or so, these multi-billion-dollar banks that -- like SVB -- in fact Gary Becker, the CEO of SVB, came to Washington and kept saying, "Lighten the regulations on us. We're just like tiny little banks, so ease up on the regulations." Donald Trump then ran for president promising he would ease up on the regulations on these multi-billion-dollar banks. He then was elected president and he put in a lot of regulators who eased up on banking regulations. Trump then went to Congress and he said, "Let's ease up even more," and, with the help of both parties, passed laws to roll back on regulations and open the door to easing up even more.
Then Jerome Powell, the chairman of the Fed, stepped up and took a flame-thrower to the regulations, saying, "I'm doing this because Congress let me do it."
And what happened was exactly what we should have predicted, and that is the banks, these big, multi-billion-dollar banks, loaded up on risk; they boosted their short-term profits; they gave themselves huge bonuses and big salaries; and they exploded their banks. And so where we stand now is now the federal government's got to step back in and back up these multi-billion-dollar banks. And I think the -- there's two halves to this. One half is, the government is clearly doing that, but there are a lot of people who are saying, gee, if they've been so lightly regulated for such a long period, it's important to look under the hood.
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And see what's happen with the other banks.
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I -- I'm going to -- not going to talk about private conversations. But I think -- let me be clear about what I'm calling for right now. I'm calling for an independent investigation of the Fed and the whole regulatory system here. The Fed doesn't just get to do its own investigation.
I'm calling for the Fed right now to reverse its weakened regulations and to bear down, to look what -- at these banks with much more scrutiny. And then I'm also calling on Congress, as you rightly say, to roll back the ability of the Fed to weaken regulations and calling for these CEOs to be held accountable so that we have laws in place to get claw backs of their bonuses, of their giant salaries.
And, when you explode a bank, you ought to be banned from banking forever.
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It depends. I think there will be investigations. The Department of Justice has opened an investigation. I think that's appropriate for them to do. We'll see where the facts take them. But we've got to take a close look at this.
And, look, we've got to say overall that we can't keep repeating this approach of weakening the regulation over the banks, then stepping in when these giant banks get into trouble.
You know, little community banks don't get this benefit. They've got to run their shop every single day to make sure they are safe and sound. Their regulators bear down pretty hard on them.
It's these giant, multibillion-dollar banks that -- there was such an irony that Gary Becker came to Washington and said, weaken the regulations because we're just like those tiny little banks that can't pose a risk to the overall economy. And --
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And that's obviously not true.
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Sure.
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So re -- so remember that in 2018, the bill that was passed had a lot of different provisions, including a lot of provisions that lightened some of the regulations, made life easier for the community banks. And there were people who supported the bill because of that.
The part I'm concerned about is called Title 4 of the bill. And it's Title 4 that says these multibillion-dollar banks, these banks with $50 billion or more in assets, should have wider regulation. Those are the banks for whom the principal regulator is the Federal Reserve Bank. And those are the banks that took on these risky practices that ultimately have, it appears, blown up at least three banks.
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And that's the provision I want to see peeled back out of the law. We need tough regulation. If you've got more than $50 billion --
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Then, by golly, you ought to be subjected to stress tests and decent capital requirements and so on.
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Look, violence is never the right answer and I always worry about it. But this is another case of Donald Trump just trying to advance the interests of Donald Trump, not of the rest of the nation.
Let's be clear about what's going on here. No one is above the law. Not even the former president of the United States. And if there has been an investigation, and that investigation should be allowed to go forward appropriately, if it's time to bring indictments, then they'll bring indictments. That's how our legal system works.
Protests are just -- there's no reason to protest this. This is the law operating as it should without fear or favor for anyone.
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