Hillary Clinton and Glass-Steagall.

Robert Reich discussed it last July:

Hillary Clinton won’t propose reinstating a bank break-up law known as the Glass-Steagall Act – at least according to Alan Blinder, an economist who has been advising Clinton’s campaign. “You’re not going to see Glass-Steagall,” Blinder saidafter her economic speech Monday in which she failed to mention it. Blinder said he had spoken to Clinton directly about Glass-Steagall.

This is a big mistake.

It’s a mistake politically because people who believe Hillary Clinton is still too close to Wall Street will not be reassured by her position on Glass-Steagall. Many will recall that her husband led the way to repealing Glass Steagall in 1999 at the request of the big Wall Street banks.

Well, and it’s “a mistake politically” because she shouldn’t be doing Wall Street’s bidding at the expense of the other 99.9% of the country. It’s a mistake politically because it’s a mistake morally. It’s a mistake politically because it’s the wrong thing to do.

It’s a big mistake economically because the repeal of Glass-Steagall led directly to the 2008 Wall Street crash, and without it we’re in danger of another one.

That too – plus that feeds into the mistake morally part. The bankers prospered even during the crash, while everyone else went to the wall. That’s not what a decent person should want for the country. Clinton shouldn’t want to be the president of the 1%.

“The idea is pretty simple behind this one,” Senator Elizabeth Warren said a few days ago, explaining her bill to resurrect Glass-Steagall. “If banks want to engage in high-risk trading — they can go for it, but they can’t get access to ensured deposits and put the taxpayers on the hook for that reason.”

For more than six decades after 1933, Glass-Steagall worked exactly as it was intended to. During that long interval few banks failed and no financial panic endangered the banking system.

But the big Wall Street banks weren’t content. They wanted bigger profits. They thought they could make far more money by gambling with commercial deposits. So they set out to whittle down Glass-Steagall.

Finally, in 1999, President Bill Clinton struck a deal with Republican Senator Phil Gramm to do exactly what Wall Street wanted, and repeal Glass-Steagall altogether.

And nine years later we got the unlovely result.