Much of the blame for the current financial crisis our country is suffering through can be traced back to de-regulation that occurred in the banking and finance industry over the last 20 years.  The majority of this regulation was put in place in the 1930's to prevent a recurrence of the events that lead up to The Great Depression.  The single biggest piece of deregulation that took place in 1999 was the repeal of the Glass-Steagall Act. 

The Glass-Steagall Act created many banking reforms designed to control speculation and against a systematic event in the banking system, basically what we are facing now.  Specifically it required for the separation of many financial activities such as investment banking operations, deposit activities, insurance, etc to reduce the potential for this domino effect that could ripple through the financial systems.  This is exactly what we are being warned may occurr now.

In a very prophetic speech made in 1999, representative John Dingell delivered the following remarks opposing the repeal of Glass-Steagall.

Madam Speaker, I yield myself the remaining time for purposes of closing. Madam Speaker and my colleagues, I think we ought to look at what we are doing here tonight. We are passing a bill which is going to have very little consideration, written in the dark of night, without any real awareness on the part of most of what it contains.

I just want to remind my colleagues about what happened the last time the Committee on Banking brought a bill on the floor which deregulated the savings and loans. It wound up imposing upon the taxpayers of this Nation about a $500 billion liability. That is what it cost to clean up that mess.

Now, at the same time, the banks by engaging in questionable practices wound up in a situation where the Fed and the Treasury Department had to bail them out also at the taxpayers' expense. But it did not show.

Having said that, what we are creating now is a group of institutions which are too big to fail. Not only are they going to be big banks, but they are going to be big everything, because they are going to be in securities and insurance, in issuance of stocks and bonds and underwriting, and they are also going to be in banks. And under this legislation, the whole of the regulatory structure is so obfuscated and so confused that liability in one area is going to fall over into liability in the next. Taxpayers are going to be called upon to cure the failures we are creating tonight, and it is going to cost a lot of money, and it is coming. Just be prepared for those events.

You are going to find that they are too big to fail, so the Fed is going to be in and other Federal agencies are going to be in to bail them out. Just expect that.

Yes, who could have seen the events now unfolding before us coming?