WASHINGTON -- Former Maryland Gov. Martin O'Malley worked to boost his Democratic presidential prospects Thursday with a set of financial reform proposals.
In a conversation with former Rep. Brad Miller (D-N.C.), who served on the House Financial Services Committee, O'Malley focused on four policies he'd push if he is elected in 2016: reinstating the law that separated commercial and investment banking; closing the revolving door between regulators and Wall Street; appointing independent-minded administrators to prosecute crimes; and imposing harsher penalties on firms that are found to have broken the law.
O'Malley also spoke in favor of doubling funds at financial regulatory agencies like the Securities and Exchange Commission.
The proposal to break up large banks was aimed, in particular, at former Secretary of State Hillary Clinton, though O'Malley didn't mention the leading Democratic candidate by name. Clinton's husband, former President Bill Clinton, signed the repeal of the Glass-Steagall law in 1999. Economists have pointed to the repeal as one contributor to the 2008 financial crisis.
“We made a commitment to the American people that we’d follow through on Wall Street reform, and we have not done that yet,” O’Malley said Thursday. “Any Democrat running for president who expects to succeed in the general election I believe will need to make basic commitments … to pass a modern version of Glass-Steagall."
O'Malley's other rival for the nomination, Sen. Bernie Sanders (I-Vt.), said last week that he supports Massachusetts Democratic Sen. Elizabeth Warren's bill to create an updated version of the Glass-Steagall legislation. One of Clinton's economic advisers said that reinstatement of the law would not factor into her campaign's proposals.
Clinton did say in her first major economic policy address on July 13 that "too many of our major financial institutions are still too complex and too risky." She argued that her administration "would go beyond" the Dodd-Frank financial reform bill, which celebrated its fifth anniversary this week. Indeed, much of the language Clinton employed in her speech anticipated O'Malley's financial reform proposals, albeit with relatively less specificity.
“I will appoint and empower regulators who understand that Too Big To Fail is still too big a problem," Clinton said. "We’ll ensure that no firm is too complex to manage or oversee. And we will prosecute individuals as well as firms when they commit fraud or other criminal wrongdoing."
To Miller, it is not surprising that all three of the candidates are speaking similarly about how to address Wall Street as they campaign.
"I think every Democratic candidate is going to end up as an economic populist, with greater or less specificity," Miller told The Huffington Post after his conversation with O'Malley. "It may not be where the contributor class is, but it’s where voters are."
At the event with Miller, O'Malley offered his 15 years of executive experience as governor and mayor of Baltimore as the sole factor differentiating him from Sanders. Miller thought this explanation was "not sufficient" if O'Malley hopes to gain on Clinton and Sanders.
"He needs to distinguish himself on the issues, which he says he want to do, and he says the campaign should be about ideas, but if everyone ends up saying the same thing, then how does he distinguish himself?" Miller said.
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