Republican presidential candidate Jon Huntsman has unveiled a financial reform proposal that would,not only repeal the Dodd-Frank financial reform bill, but cap bank sizes relative to the United States gross domestic product (GDP) and impose a fee on large banks to discourage institutions from being “too big to fail” and to cover the cost of bailouts that might be made necessary by such large banks.
“[E]liminating “too big to fail” is really the core of what he’s trying to do,” explains James Pethokoukis, who has the proposal. “As Team Huntsman correctly notes, the six largest U.S. financial institutions are significantly bigger than they were before the financial crisis. These banks now have assets worth over 66 percent of gross domestic product—at least $9.4 trillion, up from 20 percent of GDP in the 1990s. And the major banks’ too-big-to-fail status gives them a huge advantage in borrowing over their competitors.”
