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 * [|Too Big to Succeed]**

THE world ** has experienced** a severe financial crisis and economic recession. The Treasury and the Federal Reserve **took** actions that __saved__ businesses and jobs and __ may __ very well __ have saved*__ the economy itself from ruin. Still, the public **seems** ungrateful, expressing anger at these institutions that __saved__ the day. Why? Americans **are** angry in part because they __sense__ [** Instructor Note: omit analysis for this noun clause ]** that the government was as much a cause of the crisis as its cure. They **realize** that more must be done to address a threat that remains increasingly a part of our economy: financial institutions that are “too big to fail.”

During the 1990s, Congress, with encouragement from academics and regulators, [|**repealed**] [| the Glass-Steagall Act] [|,] the Depression-era law that __ had barred__ commercial banks from undertaking the riskier activities of investment banks. Following this action, the regulatory authority significantly **reduced** capital requirements for the largest investment banks.

Less than a decade after these changes, the investment firm Bear Stearns **failed**. Bear **was** the smallest of the “big five” American investment banks. Yet to avoid the damage its failure might cause, billions of dollars in public assistance ** was provided*** to support its acquisition by JPMorgan Chase. Soon other large financial institutions ** were found*** to also be at risk. These firms ** were required*** to accept billions of dollars in capital from the Treasury and ** were provided*** hundreds of billions in loans from the Federal Reserve.

In spite of the public assistance required to sustain the industry, little ** has changed** on Wall Street. Two years later, the largest firms ** are ** again **operating** with bonus and compensation schemes that reflect success, not the reality of recent failures. **Contrast** this with the hundreds of smaller banks and businesses that __failed__ and the millions of people who lost their jobs during the Wall Street-fueled recession. There **is** an old saying: **[ Omit analysis] ** lend a business $1,000 and you own it; lend it $1 million and it owns you. This latest crisis **confirms** that the economic influence of the largest financial institutions __is__ so great that their chief executives __ can __not __manage__ them, nor ** can ** their regulators **provide** adequate oversight.

Last summer, Congress **passed** a law [|to reform our financial system.] It **offers** the promise **[Omit analysis]** that in the future there will be no taxpayer-financed bailouts of investors or creditors. However, after this round of bailouts, the five largest financial institutions **are** 20 percent larger than they __were__ before the crisis. They **control** $8.6 trillion in financial assets — the equivalent of nearly 60 percent of gross domestic product. Like it or not, these firms **remai**n too big to fail. How **is** it possible that post-crisis legislation __leaves__ large financial institutions still in control of our country’s economic destiny? One answer **is** ** [omit analysis] ** that they have even greater political influence than they had before the crisis.