Yesterday Senators Warren, King, McCain, and Cantwell introduced the 21st Century Glass-Steagall Act of 2013 which would rebuild the firewall between commercial and investment banks that existed from the days of FDR's first term following the great crash until 1999 at the height of bipartisan deregulation fever—a 66 year-period without a financial crisis as destructive as the one that occurred in 2008.
The legislation introduced today would separate traditional banks that have savings and checking accounts and are insured by the Federal Deposit Insurance Corporation from riskier financial institutions that offer services such as investment banking, insurance, swaps dealing, and hedge fund and private equity activities. This bill would clarify regulatory interpretations of banking law provisions that undermined the protections under the original Glass-Steagall and would make "Too Big to Fail" institutions smaller and safer, minimizing the likelihood of a government bailout.
Of course the bill, despite its bipartisan sponsors, isn't likely to find it's way into law anytime soon in a Congress about to go nuclear over confirming cabinet-level executive appointees. What it does accomplish, however, is to push the boundaries of debate in a way that more closely aligns with the public's support of, among other things, breaking up the banks. Fundamentally, it puts Wall Street on the defensive, and any time and money spent holding on to won territory is time and money not spent on new forays disasembling what regulations remain. It's about time.