The United States is due for another financial crisis, and when it happens many of the underlying conditions will be worse than they were at the time of the 2008 financial crash, says Thomas Hanna, research director of the Democracy Collaborative and the author of the report, “The Crisis Next Time,” in an interview with The Real News Network.
That’s why policymakers need to be prepared with solutions that are radically different from the financial industry bailouts that was the cornerstone of the response to the 2008 crisis, Hanna says.
In Part I of the interview with Real News Network correspondent Sharmini Peries, Hanna explains how Wall Street managed to bring the country to the point of having a regulatory framework “that has been systemically weakened to the point that it is not going to address another financial crisis.” Part II focuses on a solution at the core of his report, public ownership of banks that require a public bailout to prevent an economic collapse. Such ownership, he stresses, builds on what the federal government already begins to do when a bank fails but takes it to its logical conclusion by assuming ownership stakes with full voting rights.
With decades of experience with a public bank in North Dakota, which helped the state weather the 2008 crisis more smoothly than many other states, and public banks in several other major countries, Hanna points out that public banks “are not new, flash-in-the-pan experiments.”