With yesterday's defeat of the Brown/Kaufman SAFE Act -- an amendment which would have broken up the big banks -- the Democrats left themselves open to the charge that they've failed to stand up to the big banks.
If Citigroup is the 'poster child' for all that went wrong in the commercial banking side of the financial industry since 1999, then, Goldman Sachs is, the 'poster child' for the investment banking side.
This bill is unquestionably deserving of support. It will make the global economy a fairer marketplace. But it will not end the too-big-to-fail incentives that encourage Wall Street to take wild risks.
Obama should threaten a veto if financial reform is impotent. Certainly the nation would feel that they regained a government responsive to them, and even if no bill is passed at this time, at least they have not been held as fools.
Under the rules governing high finance, bankers can win every time. They're essentially serving as "the house" within a vast global casino. That yields a lot more cash than moving the nation's savings into productive investments.
Along comes a great whitewash orchestrated by the New York Times and their star financial reporter, Andrew Ross Sorkin, giving succor to those who would do away with the Volcker rule in the new financial reform legislation.