John Kennedy takes a look at the last financial collapse to grip a nation - the 1929 stock market crash - and tells the story of a Florida lawmaker who pushed for reforms that lasted for decades until being undone by the banking industry.
"Chairing the investigation was a Floridian, Jacksonville Sen. Duncan Fletcher,
whose name today is largely lost in history. But his probe of the
freewheeling financial era that crashed with the Great Depression
spanned two years, filled 11,000 pages of testimony and spawned many of
the nation's banking regulations still in place.
The Glass-Steagall Act of 1933 grew out of Fletcher's hearings, separating commercial banks from investment houses. Bank deposits became federally insured, protecting Americans' nest eggs, while the Securities Exchange Act of 1934 also tightened Wall Street regulation.
Glass-Steagall endured until Congress in 1999 bowed to pressure from the banking industry and repealed the measure. Many critics now blame the repeal for sparking the current global crisis, since risky investments and subprime lending flourished in the newly deregulated climate.
"Fletcher is one of most important figures to come out of Florida in the 20th century, but he's been mostly forgotten," said J. Wayne Flynt, a retired Auburn University historian." (full story here)
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