Editorial: What was wrong with the Glass-Steagall Act, anyway?

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Congress bailed out the banks. To make sure it wouldn't happen again, new financial restrictions in the
Congress bailed out the banks. To make sure it wouldn't happen again, new financial restrictions in the form of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2009 were passed. Dodd-Frank contained a sort of "Glass-Steagall lite," called the Volcker Rule, saying that investment banks couldn't trade on their own accounts.

As we saw last week when JPMorgan Chase announced a $2.3 billion loss on an exotic derivatives position, there is still work to be done. Jamie Dimon, the chairman and CEO of JPMorgan, and his fellow bankers have been complaining that Dodd-Frank went too far, even as financial industry lobbyists have been scurrying around Congress — and spending $253 million on political contributions in the current political cycle — gutting it before it gets started.

Big bankers have gotten used to obscene profits and absurd bonuses. Politicians of both parties — Democrats have received more than a third of the industry's contributions — are eager to do their bidding. President Barack Obama has boasted about Dodd-Frank, but he hasn't done much to make sure it stays intact.

Here's a campaign slogan: Bring back Glass-Steagall. It was good enough for FDR. It was good enough for 50 years of prosperity. The money that is churning through international finance these days is doing just that — churning, creating profits, not jobs. It makes food and fuel and most everything else more expensive. It is an outsized Ponzi-scheme that enriches the few at the expense of the many.