- Senator Bernie Sanders blames Trump-era policies for cracking down on Silicon Valley banks.
- Sanders said the 2018 law deregulated the industry and sowed the seeds of bank failure.
- Sanders said the 2018 law had to be repealed because it was “too big to break up the bank”.
Senator Bernie Sanders blamed the failure of Silicon Valley Bank on Trump-era banking laws.
“Let’s be clear, the failure of the Silicon Valley Bank is a direct result of the ridiculous 2018 bank deregulation bill signed by Donald Trump, which I strongly opposed,” Sanders said. wrote in a statement on Sunday.
Sanders was referring to Economic Growth, Deregulation, and Consumer Protection LawsFormer President Donald Trump Signed into law in May 2018.
This bill Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. In signing the bill, Trump commented on previous banking reforms, saying, “They were in big trouble. One size fits all – those rules don’t work.” Washington Post.
Trump also said at the time that the Dodd-Frank Act was “killing local banks and credit unions across the country.”
Signing the bill into law meant Trump exempted smaller banks from harsh regulation and relaxed the rules big banks had to follow. The law raised the asset threshold for “systemically important financial institutions” from his $50 billion to his $250 billion.
This means that Silicon Valley Bank, which had $209 billion in assets in 2022, is no longer designated as an institutionally significant financial institution. As such, it was not subject to the more stringent regulations that apply to large banks.
In a statement on Sunday, Sanders wrote that the Trump administration ignored all the lessons it should have learned from the 2008 Wall Street crash and Enron scandal.
“Now is not the time for US taxpayers to bail out Silicon Valley banks. Any Silicon Valley bank bailout would have to be 100% funded by Wall Street and the big financial institutions,” he wrote. rice field.
Sanders added that the United States “cannot continue down the path of socialism for the wealthy and rugged individualism for the rest.”
Sanders said, “Stand up against Wall Street, repeal the disastrous Bank Deregulation Act of 2018, break up banks too big to fail, and address the needs of working families, not the risky bets of vulture capitalists.” Be brave,’ he wrote.
Trump has argued without evidence that the crackdown on Silicon Valley banks should be blamed on the “economy.”
“With what is happening to our economy and the biggest and stupidest tax hike proposal in the history of the United States, Joe Biden will go down as the Herbert Hoover of the modern age.” trump wrote in a true society.
“It will be a much bigger and more powerful Great Depression than 1929,” Trump said.
A Trump spokesperson told Insider: SVB.”
“This is just a sad attempt to gaslight the public to avoid responsibility,” a spokesperson told Insider.
The Federal Deposit Insurance Corporation closed Silicon Valley banks on Friday following a devastating bank crackdown. The failure of Silicon Valley Bank was the largest bank failure in the United States since the 2008 financial crisis.
The FDIC guarantees deposits of up to $250,000 per depositor, per institution, per ownership category. But startups with more than $250,000 in Silicon Valley Bank are at risk of not being able to pay their salaries next week.
