TEXT C The Supreme Court’s recent
decision allows regional interstate banks to do away with one restriction in
America’s banking operation, although many others still remain Although the
ruling does not apply to very large money-center banks, it is move in a
liberalizing direction that could at last push Congress into framing a sensible
legal and regulatory system that allows banks to plan their future beyond the
next court ease. The restrictive laws that the courts are
interpreting arc mainly a legacy of the bank failures of the 1930s. The current
high rate -- higher than at any time since the Great Depression -- has made
legislators afraid to remove the restrictions. While legislative timidity, is
understandable, it is also mistaken. One reason so many American banks are
getting into trouble is precisely that the old restrictions make it hard for
them to build a domestic base large and strong enough to support their
activities in today’s telecommunicating round-the-clock, around-the-world
financial markets. In trying to escape from these restrictions, banks are taking
enormous, and what should be unnecessary, risks. For example, would a large bank
be buying small, failed savings banks at inflated prices if federal law and
states’ regulations permitted that bank to expand through the acquisition of
financially healthy banks in the region Of course not. The solution is clear
American banks will be sounder when they are not geographically limited. The
House of Representative’s banking committee has shown part of the way forward by
recommending common-sensible, though limited, legislation for a five-year
transition to nationwide banking. This would give regional banks time to group
together to form counterweights to the big money-center banks. Without this
breathing space the big money-legislation should be regarded as only a way
station on the road towards a complete examination of American’s suitable
banking legislation. Which of the following best describes why the restrictive banking laws of the 1930s are still on the book
A．The bank failures of the 1930s were caused by restrictive courts. B．Banking has not changed in the past 50 years. C．The banking system is too restrictive, but on alternatives have been suggested. D．Legislators apparently believe that banking problems similar to those of the Depression still exist today.