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'Too Big to Fail' Fallout on Capitol Hill





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Rep. Brad Sherman (D-CA) intends to introduce an amendment to the proposed House Financial Services Committee "Too Big to Fail" bill that will require large banks to fund their own insurance against failure. This came after smaller banks and economists raised concerns that the requirements for the smaller banks to pay into the fund would also require those smaller banks to carry the financial burden for the larger banks should they fail -- larger banks that would be helped through crises because they were too big to fail whereas the smaller banks would be left to fail under similar circumstances.
Rep. Brad Sherman (D-Calif.) will introduce an amendment to a bill in the House Financial Services Committee to raise the existing threshold to either $50 billion or $75 billion, he told Huffington Post on Wednesday night. Those thresholds could rise in the future should he make them inflation-adjusted, he said.
Policies and proposed legislation involving banks considered too big to fail have also seen bipartisan criticism which has led to the introduction of legislation to provide more transparency into the lending activities by the Federal Reserve:
House pushes for sweeping audit of the Fed
Bipartisan effort aims to get peek into secretive U.S. central bank

WASHINGTON - House lawmakers want to pry open the books of the famously secretive Federal Reserve with legislation that would subject the U.S. central bank to a sweeping congressional audit.

The effort is overwhelmingly bipartisan. Hardline conservatives and liberal Democrats have banded together in their criticism of the Federal Reserve as a major power broker in the financial system that does not answer to Congress.
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