Sen. Peterlini Presents Glass-Steagall Bill in Italy
February 10, 2012 • 8:02AM

Italian Sen. Oskar Peterlini has presented a draft bill for the reintroduction of a banking separation system following the Glass-Steagall model in Italy, with the stated goal of both helping the Italian economy immediately and serving as an example for the rest of the world.

Peterlini's bill, No. 3112 in the Italian Senate, has 11 co-signers so far, from both his group, which includes various small parties in Italy's autonomous regions, and also from other major parties, such as the Democratic Party (PD), the Northern League (Lega Nord) and Italy of Values (Italia dei Valori). Of these only the Lega Nord consistently opposes the current technocratic government led by market darling Mario Monti.

Peterlini has a long history of introducing resolutions calling for serious reform of the global financial system, with campaigns for a New Bretton Woods starting in the early 2000s and a resolution on Glass-Steagall in 2010. The introduction of a bill is an important step forward, which will jump-start a public campaign in favor of the proposal, and comes at a time when the issue of saving the productive economy from financial speculation is taking center stage in Italy, due to both the ongoing financial crisis and the recent interventions of former Economics Minister Giulio Tremonti.

The bill, which was written in concert with Movisol, the LaRouche movement in Italy, is short and simple, calling for the complete separation of banks that accept deposits from those that participate in the financial markets in any manner.

Peterlini issued a press release in Italian and German (for his South Tyrol constituency), and reads as follows:

"Sen. Peterlini: 'Ensure Credit for Enterprises'

"Bill by the Senator from Bolzano on separating commercial banks from investment banks in order to support local economies.

"'Firms are suffering from liquidity problems because of a credit crunch. Above all, small and medium enterprises can no longer make investments. We therefore call on the Italian government to reform the banking system, by separating commercial banks from investment banks, restoring the system that existed until the 1990s thanks to the Glass-Steagall Act of 1933.' This is the main request put forward by Bolzano Senator Oskar Peterlini in his bill. 'Since the 2007 global economic crisis we have been discussing how to avoid new economic-banking crises. Unfortunately, we must note that in the numerous international summits that have been held, the opportunity to adopt strong measures that could represent a clear and effective break with past policies has not been seized: Such measures would certainly include a return to a separation of banking activities, the Bolzano Senator stresses. According to Peterlini, we can no longer wait: the system must be changed as soon as possible. 'Italy can pave the way for other countries: let us go back to a separated banking system in order to make sure that common people no longer have to pay for global speculative bubbles. Let us establish clear rules for separation between chartered (commercial) banks and banks trading on speculative markets (investment banks), that become a model at international level.' Peterlini's bill is a concrete step forward in the campaign carried out by the MOVISOL movement, which fights globally for bank separation. So far the bill has been signed by eleven members of the Senate.

"Specifically, Peterlini's bill commits the government to adopt, within 12 months, one or more legislative decrees to establish rules for separating commercial banks from investment banks, including a ban on chartered banks performing any activities related to trading of securities in general. 'Italy has the chance to both help its citizens directly and to encourage progress in other nations, by establishing a principle of the highest importance at the international level, Peterlini states. 'We need to save the real economy from speculative finance, through a separation between commercial banks and investment banks. It will be an essential first step to regaining control over the economy and building the basis for a future of stability and progress.'"