Mr. Sanders’s shocking ignorance on his core issue
By Editorial Board
April 7, 2016 at 7:40 PM
Sen. Bernie Sanders speaks during a campaign stop at the Pennsylvania AFL-CIO Convention in Philadelphia. (Matt Rourke/AP)Sen. Bernie Sanders and his wife, Jane, eat at the Brooklyn Diner in New York. (Brian Snyder/Reuters)Sen. Bernie Sanders gestures to supporters during a campaign rally in Laramie, Wyo. Sanders won the Democratic presidential primary in Wisconsin on Tuesday. (Brennan Linsley/AP)Democratic presidential candidate Bernie Sanders arrives to have breakfast at the Blue's Egg restaurant in Milwaukee. (Darren Hauck/Getty Images)Sen. Bernie Sanders speaks with a patron while stopping for breakfast at Blues Egg. (Mark Kauzlarich/Reuters)Sanders eats breakfast in Milwaukee on the day of the Wisconsin primary. (Mark Kauzlarich/Reuters)Sanders speaks with a patron at Blue's Egg. (Mark Kauzlarich/Reuters)Bernie Sanders arrives at a campaign rally at the Wisconsin Convention Center in Milwaukee. (Scott Olson/Getty Images)People cheer at a Sanders campaign rally at the Wisconsin Convention Center. (Scott Olson/Getty Images)Sanders arrives onstage at his campaign rally in Milwaukee. (Scott Olson/Getty Images)Sanders pumps his fist during the Milwaukee campaign event. (Paul Sancya/AP)Supporters listen as Sanders speaks in Milwaukee. (Paul Sancya/AP)Sanders speaks in Milwaukee. (Paul Sancya/AP)Sanders speaks at the Wisconsin Convention Center. (Scott Olson/Getty Images)Supporters hold up signs as Sanders speaks at a campaign rally in Green Bay, Wis. (Mark Kauzlarich/Reuters)Sanders addresses the crowd at the Sheboygan South High School Acuity field house in Wisconsin. (Jabin Botsford/The Washington Post)People hold signs that say A future to believe in during Sanderss campaign event in Sheboygan, Wis. (Jabin Botsford/The Washington Post)Democratic presidential candidate Bernie Sanders and his wife, Jane, wave to supporters at Sheboygan South High School in Sheboygan, Wis. (Jabin Botsford/The Washington Post)A supporters holds a sign at Sanderss campaign event in Sheboygan, Wis. (Jabin Botsford/The Washington Post)Sanders shakes hands with a supporter after his address at the Sheboygan South High School in Wisconsin. (Jabin Botsford/The Washington Post)A woman holds a drawing of Sanders as he speaks at a campaign rally at the University of Wisconsin at Green Bay campus in Green Bay, Wis. (Mark Kauzlarich/Reuters)Democratic presidential candidate Bernie Sanders speaks during a rally at Safeco Field in Seattle. (Jason Redmond/AFP/Getty Images)Democratic presidential candidate Bernie Sanders pumps his fist at passers-by while arriving for breakfast at Lou Mitchell's Restaurant and Bakery in Chicago. (Ricky Carioti/The Washington Post)Bernie Sanders smiles as he sits for breakfast with his guests, Cook County Commissioner, Jess "Chuy" Garcia and his wife Evelyn at Lou Mitchell's Restaurant and Bakery in Chicago. (Ricky Carioti/The Washington Post)Supporters listen as Sanders speaks to them during a rally at the PNC Music Pavilion in Charlotte. (Ricky Carioti/The Washington Post)Sanders speaks to his supporters during a rally at the PNC Music Pavilion in Charlotte. (Ricky Carioti/The Washington Post)Bernie Sanders speaks to his supporters at the PNC Music Pavilion in Charlotte. (Ricky Carioti/The Washington Post)Sanders speaks to supporters during a rally at the Auditorium Theater of Roosevelt University in Chicago. (Ricky Carioti/The Washington Post)Sanders speaks to his supporters at the Auditorium Theater of Roosevelt University in Chicago. (Ricky Carioti/The Washington Post)Supporters of Sanders cheer during his rally at the Family Arena in St. Charles, Mo. (Ricky Carioti/The Washington Post)Sanders arrives to speak to his supporters during rally at the Covelli Centre in Youngstown, Ohio. (Ricky Carioti/The Washington Post)Young people listen as Sanders speaks at the Covelli Centre in Youngstown, Ohio. (Ricky Carioti/The Washington Post)Sanders speaks to his supporters during a rally at the Covelli Centre in Youngstown, Ohio. (Ricky Carioti/The Washington Post)Supporters cheer as Bernie Sanders speaks to them during a rally in the Schottenstein Center at Ohio State University in Columbus, Ohio. (Ricky Carioti/The Washington Post)Bernie Sanders speaks to his supporters during a rally in the Schottenstein Center at Ohio State University in Columbus, Ohio. (Ricky Carioti/The Washington Post)Bernie Sanders addresses an overflow crowd during a campaign rally at the University of Illinois at Urbana-Champaign. (Shannon Stapleton/Reuters)Supporters listen to Bernie Sanders at the University of Illinois at Urbana-Champaign. (Shannon Stapleton/Reuters)Supporters wait to enter the Sanders rally. (Charles Ledford/Getty Images)Sanders speaks at the University of Illinois at Urbana-Champaign. (Shannon Stapleton/Reuters)Sanders waves to supporters after addressing the rally. (Shannon Stapleton/Reuters)Sanders waves to a crowd as he arrives at the Rainbow Push Coalition in Chicago. (Nam Y. Huh/AP)A Sanders supporter cheers the Democratic presidential candidate at the Rainbow Push Coalition, a group headed by the Rev. Jesse Jackson. (Nam Y. Huh/AP)The Rev. Jesse Jackson, right, listens as Sanders speaks at the Rainbow Push forum in Chicago. (Tannen Maury/European Pressphoto Agency)Sanders, center, greets members of the crowd at the Rainbow Push Coalition after sitting for an interview with the Rev. Jesse Jackson in Chicago. (Scott Olson/Getty Images)Democratic presidential candidate Bernie Sanders addresses a rally at Macomb Community College in Warren, Mich. (Geoff Robins/AFP/Getty Images)Sanders supporters cheer during a rally at Macomb Community College in Warren, Mich. (Geoff Robins/AFP/Getty Images)Sanders laughs as he arrives to speak to his supporters during a Super Tuesday rally at the Champlain Valley Exposition in Essex Junction, Vt. (Ricky Carioti/The Washington Post)
Photo Gallery: Highlights from Bernie Sanders’s campaign, in pictures
MORE THAN anything else, Sen. Bernie Sanders (I-Vt.) has based his campaign on attacking Wall Street — the millionaires and billionaires who, by his telling, wrecked the U.S. economy, dominate the political system and must be brought to heel. Given his commitment to the message, you might expect he would have some familiarity with the policy details and implications.
A New York Daily News
editorial board interview with the candidate proved otherwise. The senator seemed to have no idea of what reformed banks should look like, or whether he would need new legislation, even though the government under his presidency would play a central role in tearing apart these complex financial institutions.
Mr. Sanders followed the interview with what was meant to be a clarifying statement. The treasury secretary would draw up a list of too-big-to-fail banks, Mr. Sanders explained, and break them up under the authority of the Dodd-Frank financial reform law. In an interview with us, Sanders policy adviser Warren Gunnels said that current regulators are not applying existing authorities aggressively enough and that Mr. Sanders would pick a strong treasury secretary with no Wall Street ties to fill in many of the details.
It’s astonishing that, on this of all issues, the campaign would need to issue a what-the-candidate-meant-to-say statement. Even then, the campaign has left a lot of essential questions unanswered.
Here’s one: What is breaking up the banks meant to accomplish?
From what Mr. Sanders and his campaign have said, you could posit several possibilities: protecting taxpayers, safeguarding the financial system, making the financial sector less concentrated and reducing the financial sector’s share of the total economy. Explaining that he wants to do all of these things is not sufficient, because policies differ depending on which goal you prioritize. Regulators working under Dodd-Frank, for example, have gone a long way to addressing the first two issues without breaking up banks, a step that many experts warn may not be worth the costs. If banking-sector concentration is Mr. Sanders’s concern, then he should explain why addressing it would justify those costs; after all, countries such as Canada have more concentrated banking systems and yet weathered the financial crisis much better. If, on the other hand, Mr. Sanders wants to shrink the overall financial sector, he must explain how breaking up a few banks into a larger number of medium-size banks would contribute.
Many voters share Mr. Sanders’s disdain for high finance and his nostalgia for an economy based more on manufacturing. But such prejudices, whether sound or not, provide an insufficient basis for remaking the world’s largest economy. Former secretary of state Hillary Clinton has a banking-sector reform proposal designed to address the highest risks to the financial system that remain after the first round of reform. Mr. Sanders has yet to furnish anything of equivalent rigor. We hope he provides more clarity in next week’s Democratic debate.