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Technology & Innovation

Too Big to Fail No More

The Dodd-Frank Financial Reform Bill gives regulators the power to break up too-big-to-fail banks. The first time this is done it will send a powerful message, says Simon Johnson.

Simon Johnson thinks that the recently passed Dodd-Frank Financial Reform Bill is not unlike the Sherman Antitrust Act of 1890. It includes a provision where federal regulators have “the right and the responsibility to limit the scope of big banks and, as necessary, break them up when they pose a ‘grave risk’ to financial stability.” Johnson thinks that if just one regulator uses these extraordinary powers to break up too-big-to-fail banks just once, it will send a powerful message.


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