Glass-Steagall Through the Back Door: Creating A Divide in Banking Functions Through the Use of Corporate Living Will

Abstract

In the first of five notes of the Columbia Business Law Review Survey, the author discusses how debate on banking regulatory reform in the wake of the financial crisis has centered on proposals to bring back features of the Glass-Steagall Act of 1933 which imposed a separation between the investment and commercial banking activities of financial institutions. The note examines why current proposals to resurrect Glass-Steagall may not adequately address the modern boundary problem in banking regulation, and ultimately advocates that greater attention should be given to the use of corporate living wills to incentivize the private-sector creation of a Glass-Steagall-like divide.