Gingrich Would Break Up Big Banks

NEW YORK ( TheStreet) -- Add Newt Gingrich to the list of Republican presidential candidates who say they support the idea of breaking up the largest U.S. banks.

Gingrich has climbed in the polls following Saturday night's Republican primary debate, and, like Rick Perry and Jon Huntsman, Gingrich has said he supports "very decisive reforms," with respect to the banking industry.

Newt Gingrich

"I think, in retrospect, repealing the Glass-Steagall Act was probably a mistake," Gingrich told Jake Tapper of ABC News in a recent interview, referring to Depression-era legislation that prohibited any combination of commercial banking, investment banking and insurance at the same company. The law was effectively repealed in 1999.

"We should probably re-establish dividing up the big banks into a banking function and an investment function and separating them out again," he said.

Huntsman and Perry were critical of the big banks during Wednesday night's debate, with the most detailed comments coming from Huntsman, the former Utah governor and ambassador to China.

Huntsman referred to "six institutions that are equal to 60, 65 percent of our GDP, $9.4 trillion," arguing "they have an implied guarantee by the taxpayers that they'll be protected. That's not fair, that's not right for the taxpayers," Huntsman said.

Huntsman was referring, of course, to JPMorgan Chase ( JPM), Bank of America ( BAC), Citigroup ( BAC), Wells Fargo ( WFC), Goldman Sachs ( GS) and Morgan Stanley ( MS) and his numbers were right on, according to this data from the Federal Reserve.

Asked what he wanted to do about this issue, Huntsman said, "we need to right size them."

Texas Governor Rick Perry voiced a similar sentiment during the debate, saying, "if they're too big to fail, they're too big."

-- Written by Dan Freed in New York Follow me on twitter.
Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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