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Huntsman wants large banks to preemptively fund own bailouts

Jon HuntsmanFormer Utah Republican governor Jon Huntsman is taking a Democratic position that large U.S. banks should set up their own funds in order to protect them if they fail.

During the Republican presidential primary debate on Wed., Huntsman endorsed the idea that Democrats have fought hard for in Congress, according to ThingProgress.org.

“I think we ought to set up some sort of fund,” Huntsman said, ThinkProgress.org reports. “I think we ought to charge some sort of fee from the banks. That mitigates the risk that otherwise the taxpayers are carrying.”

During last year’s debate over the Dodd-Frank financial reform law, Democrats attempted to include a provision that would have required large U.S. banks to build up a fund that they could use in case of a failure. The fund, according to Democrats, would help ensure taxpayers that tax dollars would not be spent on another government bailout.

According to the Congressional Budget Office, a bank tax would “improve the competitive position of small- and medium-size banks, probably leading to some increase in their share of the loan market,” according to ThinkProgress.org.

Huntsman also supports separating investment banking and commercial banking through a repealed law known as the Glass-Steagall Act. His primary opponent, former speaker of the House of Representatives Newt Gingrich, has also alluded to his support for a return to Glass-Steagall.

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