and Rep. Thomas J. Bliley, Jr. (R, Virginia), the
co-sponsors of the Gramm–Leach–Bliley Act.
Many believe that the Act directly helped cause the 2007 subprime mortgage financial crisis. President Barack Obama has stated that GLB -- led to deregulation that, among other things, allowed for the creation of giant financial supermarkets that could own investment banks, commercial banks and insurance firms, something banned since the Great Depression. Its passage, critics also say, cleared the way for companies that were too big and intertwined to fail. Economists Robert Ekelund and Mark Thornton have also criticized the Act as contributing to the crisis. They state that "in a world regulated by a gold standard, 100% reserve banking, and no FDIC deposit insurance" the Financial Services Modernization Act would have made "perfect sense" as a legitimate act of deregulation, but under the present fiat monetary system it "amounts to corporate welfare for financial institutions and a moral hazard that will make taxpayers pay dearly."Nobel Prize-winning economist Paul Krugman has called Senator Phil Gramm "the father of the financial crisis" due to his sponsorship of the Act. Nobel Prize-winning economist Joseph Stiglitz has also argued that the Act helped to create the crisis. An article in the liberal publication The Nation elaborated on how GLB was responsible for the creation of entities that could make the “too big to fail” rationalization.