CHICAGO — Austan Goolsbee, the chief economist at the White House, said the administration is not focused primarily on size when attempting to address "too big to fail."
Speaking at a panel at a conference hosted by the Federal Reserve Bank of Chicago, he said the focus should be on an institution's riskiness.
The rationale on Capitol Hill seems to be "why don't we smash anybody that is as big as 'X' … and that would end too big to fail," he said.
Instead, Goolsbee argued for closer examination of the risk at some of these institutions, rather than breaking up banks into multiple pieces.
"It's not how big they are, but how risky they are," he said. "Some of these financial threats are a bit like worms you can chop them in half, but that doesn't get at the problem."
The Senate is continuing to debate regulatory reform legislation, with some 90 amendments filed.