Two New Jersey lawmakers who ignited the financial apocalypse are still in Congress

In the summer of 1999, with the ink barely dry on the walls of Washington’s charred political machine, two New Jersey congressmen, Frank Pallone and Chris Smith, helped light a match that set the stage for the financial apocalypse to come.

They voted on July 1, 1999, with the same cheerfully oblivious attitude they’d later use to vote on wars and other financial disasters, for the Gramm-Leach-Bliley Act (GLBA), a bill so staggeringly miscalculated it should have come with a warning label: “Handle with care, for the future of the global economy may depend on it.”

They didn’t get it then, and they still don’t get it now.

When they threw their weight behind the GLBA, they threw out decades of regulatory safeguards put in place by Glass-Steagall and the Bank Holding Company Act, laws that had been keeping the financial system just barely held together since the Great Depression.

In one reckless move, they obliterated the walls separating commercial banks, stock brokerages, and insurance companies—turning Wall Street into a bloated, monstrous Frankenstein of greed, speculation, and risk.

The banks now had a free pass to run amok, merging, conglomerating, and plundering, as if the lessons of 1929 had never even happened. In less than a decade, the whole system collapsed again.

By setting the stage for the Financial Services Modernization Act of 1999, Pallone and Smith ensured that the very structures which had prevented a repeat of the Great Depression were now in ruins, like children gleefully smashing the toys that kept their house from falling down.

It was a fatal miscalculation, the kind of error that only Washington insiders can make when they think the free market has an invisible hand guiding it.

Sure, they threw a few token privacy protections in the bill—‘The Privacy Rule’ and ‘The Safeguards Rule’—but these were nothing more than window dressing. If anything, they were designed to make the bill look responsible, even as it carved out a massive loophole for the financial sector to run roughshod over everyone else.

And they didn’t stop there.

Just a year later, on October 19, 2000, Pallone and Smith, in a show of bipartisan ignorance, voted in favor of the Commodities Futures Modernization Act (CFMA), another epic catastrophe that paved the way for the 2008 crash.

They threw their lot in with this charade, a bill that was practically a love letter to Wall Street’s most reckless and corrupt interests. In their eagerness to deregulate the markets even further, they gave the green light to the very kind of speculation that would ignite the global financial crisis.

With one stroke, they made sure that derivatives, complex financial instruments that no one fully understood, would operate in the shadows of a broken system—no oversight, no accountability, no hope for the ordinary people who would eventually get crushed under the weight of it all.

In doing so, they ensured that the Wall Street wrecking crew would be able to gamble away the savings of millions of Americans while their friends in high places raked in billions.

For Pallone and Smith, it was just another day in the office, another deal with the devil to keep the wheels of corporate America greased and spinning.

It didn’t matter that people lost homes, jobs, and livelihoods in the wake of the 2008 crash. It didn’t matter that the global economy teetered on the brink of total collapse. They had cast their votes, they had played their parts, and they had ensured that the system would remain rigged.

Of course, as the years rolled on, the bill’s disastrous consequences became glaringly obvious.

The very deregulation they championed in the name of “modernization” had led to one of the worst financial meltdowns in history. The corporate consolidation they endorsed gave birth to massive, “too big to fail” institutions whose reckless gambling sent shockwaves through the entire global economy.

In the wake of these disastrous votes, the American public stood bewildered, questioning how men who were supposed to serve their constituents could have betrayed them so completely.

Frank Pallone and Chris Smith may have made their deals behind closed doors, but the consequences of their actions were felt far and wide.

Their names should be synonymous with a kind of corporate cronyism that allowed the wealthiest to play in a rigged casino while the rest of us were left with the bill.

The shameful legacy of their votes on the Gramm-Leach-Bliley Act and the Commodities Futures Modernization Act continues to echo in the halls of Washington.

Years after the crash, their decision to unravel the financial safety net remained a clear, unmistakable testament to their commitment to corporate interests over the people they swore to serve.

Even now, in 2025, it’s hard to escape the feeling that we’re on the precipice of another disaster, with the same characters involved.

In an age where the crypto world is just as unregulated and ripe for manipulation as the pre-crash stock market, these same old players—some of whom are still in office—are handing out votes like candy to new financial schemes that will undoubtedly plunge us into the same abyss. It’s as if no one learned a damn thing from the last catastrophe.

Pallone and Smith may still be collecting their salaries and raising their hands to vote on whatever the financial elite wants next, but the damage they’ve done remains a permanent scar on the American financial landscape.

The Wall Street crash of 1929, was followed by the Great Depression, and the largest economic depression in the 20th century contributed to the rise of fascism that brought about World War II.

Is it any coincidence that the Great Recession, triggered by the 2008 financial crisis—which saw a collapse in the housing market, high unemployment, bank failures, and a significant decline in economic output—ultimately led to the political success of tyrannical Donald Trump?

If there is any justice in this world, history will remember Pallone and Smith not as stewards of the public good but as two of the many who helped crash the system for a quick buck and a pat on the back.