Robert Reich:The Only Way to Prevent Another Bailout of Wall Street is Cap Size of Wall Street Banks

Bankers would endlessly lobby to push the size limit upward and to get exceptions. And size limits alone do nothing to control conflicts of interest between lending and investing.

It surely seem the banking system is rigged--due in no small part to the banks 'owning the place.' The place being Congress, of course.

And if Congress does nothing to repair Phil Gramm's damage, we'll know they still own the place.

Companies simply cannot be allowed to be so large a piece of our economy that if any one or strategic few collapse that the undertow is so dramatic that the remaining economy cannot either functionally or in direct effect go on without crashing out.

Until percentage of GDP and percentage of critical function is seriously dealt with their can be no law that will truly prevent too big too fail. We can't have just a handful performing any essential functions, that stuff needs to be better spread throughout the entire sector or we actually end up reinforcing to big to fail as we make these entities defacto if not actually a piece of the government.

Its probably likely the Dodd's bill will have the end effect of preventing smaller banks from reaching a certain size and penetration but would leave the current criminals even more firmly entrenched.

Anyone that dares to speak of "half a loaf" on this issue will be allowing the next round of theft and poverty to get started.

We'll win the message war against any level of noise if we have a bill that would at least cause the corporate pirates to invent new ways of gaming the system.
If there is anything obvious then it should and must be dealt with now, not in some imagined point down the road since there will be mischief enough from the predator class under watchful eyes and tough rules without leaving them clear and apparent exceptions and loopholes to exploit.

We need to truly end to big to fail INCLUDING breaking up existing such institutions while spreading their power and critical function over much more of the sector.

We need sane capital requirements.

Strong and independent consumer protection.

Knock out the cross stealing and threat contamination by separating various functions as much as possible.

Transparent markets-across the board.

End blind derivatives or move them exclusively to the casinos, that's straight up gambling with zero thought to anything in the ballpark of investment. You can't even be a counter-balance or a hedge when you're just dealing with how big a bet you're willing to make.

Do anything possible to increase the return of actually creating value AKA work and actual investment and reduce the lure of speculation.

Adding in the certainly important things that haven't sprung to my mind. Necessity should drive this rather than the lame cop out of "politically feasible". We can't afford to seek half measures, they will lead to as much destruction as sitting around with our collective thumb up our collective ass, maybe more by creating a false sense of safety.