[ [link removed] ]Katie Porter for Senate



John,

Katie Porter and Elizabeth Warren just introduced the Secure Viable
Banking Act. This legislation would restore common-sense guardrails that
Wall Street clearly needs. 

In 2018 before Katie was in Congress, a bipartisan majority of lawmakers
voted to repeal important regulations on Wall Street. That repeal
contributed to the bank collapses we’ve seen over the past week, but
Katie’s new legislation will reinstate some of these guardrails and help
hold Big Banks accountable.

Now, Congress needs to pass this bill into law. [ [link removed] ]Sign on to show your
support.

[ [link removed] ]Sign Now ›››

And to learn more about the Silicon Valley Bank collapse, check out the
message Katie sent Sunday. 

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John,

As a consumer protection attorney who has spent my career taking on Wall
Street, I wanted to help break down what’s happening with Silicon Valley
Bank.

Silicon Valley Bank is a well established bank that has been really
important in lending to technology companies. During the pandemic, the
bank grew rapidly in size. As banks do, it turned around and invested that
money. But they were investing in U.S. treasury bonds, which take years to
reach their full value.

The problem for Silicon Valley Bank? Interest rates have gone up, so
venture capitalists are moving their money now to get more bang for their
buck. And as of Friday, Silicon Valley Bank didn't have enough liquid cash
(i.e. capital) to return people’s deposits—leading to its collapse.

There are some real oversight questions about why the bank wasn’t
prepared, but the blame isn’t all on them. Congress played a real role in
this debacle.

After the 2008 financial crisis, Congress passed legislation to require
banks to hold onto more liquid cash. This thicker cushion lowered the risk
for consumers—but it wasn’t ideal for the banks, which want to invest as
much as possible to earn more profit.

Wall Street has been working to reverse these consumer protections ever
since. When Trump was elected in 2017, a group of Senators pushed to allow
medium-sized banks, like Silicon Valley Bank, to hold onto less liquid
cash. I wasn’t yet in Congress, but I sounded the alarm that this was a
dangerous move that put people’s money at risk. But in the end,
Congress—in a bipartisan vote—caved to Wall Street and loosened our
nation’s banking laws.

I have no problem standing up to Wall Street, so I’m writing legislation
to reverse that risky law. I’m also working with state officials to make
sure businesses and employees who depend on Silicon Valley Bank can still
pay their bills.

I wanted to send this summary because I know how scary bank closures can
be. When I was growing up in Iowa, the small town bank closed on a Friday
afternoon, and everybody in the community was worried about how they were
going to get their deposits out or make payroll—the same concerns we're
having today.

That experience is part of what inspired me to study bankruptcy law under
my then-professor Elizabeth Warren. I saw how Wall Street wielded
political power to rig the rules against working people, and how they
rarely took responsibility for their own (frequent) mistakes. After the
2008 financial crash, I was appointed to be California’s Independent
Monitor over the Big Banks. My job was to make sure California families
who were cheated by the five biggest Wall Street banks received the
compensation a new settlement entitled them to. I held the banks’ feet to
the fire, and forced them to pay Californians billions.

Now more than ever, California needs a warrior in the Senate who has the
courage and experience to stand up to Wall Street.

I’ll follow up as we learn more,

Katie Porter



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