News / Brèves Back to previous selection / Retour à la sélection précédente ITALY: More Glass-Steagall debate over the MP’s issue 31 January 2013 (EIRNS)—Giulio Tremonti and Apulie regional governor Niki Vendola hosted the "Unomattina" morning magazine of Italian Raiuno television channel yesterday. As in a role-playing game, Vendola picked up the Glass-Steagall issue usually addressed by Tremonti, who then chimed in with support of Vendola. Vendola is the leader of the leftist component of the Democratic Party who had already called for banking separation in the past. A former leader of the militant gay movement, during his mandate as chairman of the Apulie regional government, he has pushed environmentalist schemes such as solar panels. However, he has been reasonable on the ILVA steel plant issue and other issues, and he has actually been at war with the Green Party, whose leaders are now running on the Jacobin slate of Palermo prosecutor Antonio Ingroia. On "Unomattina" yesterday, Vendola said that the Monte dei Paschi case shows the problem of banks which have dual functions as deposit banks and investment banks. "In 1933, under Roosevelt, these functions were separated, so that depositors’ money could not be used to speculate. I believe this was called the Glass-Steagall Act. Then, under Clinton, I believe in 1999, this separation was repealed." Tremonti added that parallel to the repeal of Glass-Steagall, derivatives were introduced on a large scale, and in Italy the old Banking Act of 1936 was also abolished by a reform pushed by Prodi and Draghi. Glass-Steagall was also mentioned in a query to the EU Commission by European Member of Parliament Mario Borghezio. Member of the European Parliament Mario Borghezio submitted a question to the EU Commission, writing that the MPS scandal "Sees the role of Goldman Sachs at the center of the investigation of the Antonveneta sale first to ABN, and eventually to MPS, with the latter paying 300% of the original value. During those deals now being investigated, the head of Goldman Sachs Europe was Dr. Mario Draghi, who, as head of the Privatizations Committee, had steered bank privatizations. Moreover, Dr. Draghi was responsible for banking supervision in the period when MPS manipulated its books to cover up large losses from high-risk derivative operations, which many say were possible thanks to the abrogation of the Glass-Steagall rules. "Given those worrying precedents, how does the Commission evaluate the role that Dr. Mario Draghi should assume in the ECB as single supervisor of the entire EU banking system?" [ccc]