Taking A Stand Against Bailouts (NAPSA)—An advocacy group called Stop Too Big To Fail is challenging the assumption that some financial institutions should be considered “too big to fail” (TBTF) and deserve to be “bailed out” with taxpayer money. As the U.S. Congress comes closer to passing legislation for financial reform, the group argues that meaningful financial reform is necessary to address the causes of the economic crisis. Legislation must balance freedom and the exchange of capital in order to ensure safety for consumers. A coalition of consumers, Stop Too Big To Fail advocates that concrete financial reform means that small and medium-sized investors should not be subsidizing “too big to fail” institutions. Instead, shareholders and man- agers within the bank should fully bear the cost of failure in order to protect against moral hazard. No NewBailouts The group opposes new bailout funds for big banks that will be paid for by investors and taxpayers. Congress needs to impose limits on leverage for financial institutions declared to be “too big to fail,” break up financial institutions, create tangible financial incentives against being “too big to fail,” and ensure that big banks can’t just pass the costs of reform on to unwitting consumers and small investors. “The policies supporting TBTF are unfair to small investors and pensioners,” said former Georgia State Senator Sam Zamarripa, Stop Too Big To Fail’s spokesperson. “Most of the investors who Advocates contend that small and medium-sized investors should not be subsidizing “too big to fail” institutions. They oppose new bailout funds for big banks that will be paid for by investors and taxpayers. will pay into the bailout fund aren’t viewed as TBTF, so will neverbe bailed out if they get into trouble—yet they will be forced to pay into this bailout fund.” The organization believes modernizing the current marketplace is essential, but more layers of government bureaucracy and more taxpayer subsidization of failing institutions will not improve America’s economic situation. Furthermore, Stop Too Big To Fail feels that by perpetuating the recognition and acceptanceof “too big to fail” firms, it allows bankers andinvestors to be predatory with taxpayer money. The Need For Accountability The group believes the key to financial stability is regulation that is thoughtful, accountable and transparent. Led by Robert K. Johnson, president, Consumers for Competitive Choice (C4CC), and former Georgia State Senator Sam Zamarripa, Stop Too Big To Fail is a project of the C4CC, a diverse national coalition of Americans who support a strong, vibrant and consumer-focused economy that is united in the belief that the country’s greatest strength is its ability to dream, build, innovate and compete. To learn more, visit www.stop toobigtofail.com.
