Elizabeth Warren Schools CNBC On Banking, CNBC Tries to Cover It Up
Last week, Senator Elizabeth Warren (D-Mass.) after questioning by CNBC's Squawk Box, delivered an eloquent defense of her proposed update to the bank-regulating Glass-Steagall Act. After Senator Warren's official YouTube account posted a clip of the interview earlier this week, the video went viral with over 700,000 views in a matter of days. That's when CNBC decided to have the video removed due to copyright infringements. It seems like CNBC got embarrassed about Warren effectively shutting down their anchor's criticism of her bank regulation bill and wanted to stop the spread of the video. But removing it from YouTube because of that reason will only drive more people to seek out the video. You can no longer find the original clip Warren posted, but you can watch the whole awesome 10 minute video below.
In 1933, the Glass-Steagall Act was passed by Congress as a way to prevent bank crashes that lead to the Great Depression. The act required banks that accept federally insured deposits from the Federal Deposit Insurance Corporation (FDIC) to focus on traditional lending and bar them from engaging in risky securities and trading. This essentially made it so that banks that handled our federally-insured money could not then use this money to engage in risky financial dealings for their own financial gain. In 1999, Congress passed the Gramm-Leach-Bliley Act which repealed the Glass-Steagall Act, effectively shattering the wall dividing commercial banks and investment banks and introducing risk to our federally-insured deposits. This new bill by Senator Warren would bring back the Glass-Steagall Act and also bar banks that accept insured deposits form dealing in swaps or operating hedge funds and private equity enterprises. The bill is unlikely to pass through Congress but it is a symbolic step in trying to rid this country of the concept "too big to fail."
In the video clip removed by CNBC, Warren effectively defends the merits of reviving the Glass-Steagall Act and taking steps to prevent something like the Great Recession of 2008 from happening again. Her main point was that banking regulation does in fact keep the financial system "steady and secure" and was crucial in eradicating the banking boom-and-bust cycle from 1933 to 1980s. She even went as far to professorially correct the anchors' knowledge of banking regulations since the Great Depression. In response to anchor Brian Sullivan's comment that "We should tell the American consumer that no matter what we do, there will be bank boom and bust cycles" Warren said "no, that is just wrong … look at the history."
Even though CNBC claimed to take down the video for copyright infringements, they did not take down other YouTube videos that use CNBC footage. It seems like CNBC got embarrassed because this specific video went viral and showed its anchors being schooled by Warren. And bad news for CNBC, there is a phenomenon called the Streisand effect whereby attempts to hide or remove information has the unintended consequence of publicizing the information more widely, especially on the internet. Just like Beyoncé and her Super Bowl pictures, CNBC should expect even more people see Warren educate its anchors on banking regulation history.
What do you think? Did Warren school CNBC's anchors? And did CNBC make a mistake taking down the video?
(Oh, and I'm also open for commission for "photoshop" work.)