Too Big to Countenance.

“Today, the nation’s four largest banks — JPMorgan Chase, Bank of America, Citigroup and Wells Fargo — are nearly $2 trillion larger than they were before the crisis, with a greater market share than ever. And the federal help continues — not as direct bailouts, but in the form of an implicit government guarantee. The market knows that the government won’t allow these institutions to fail. It’s the ultimate insurance policy — one with no coverage limits or premiums.”

Joining ranks across the partisan divide, Senators Sherrod Brown and David Vitter introduce legislation aimed at ending Too Big To Fail: “The senators want the major banks to increase their own tangible equity so that shareholders, and not just taxpayers, take responsibility for their risky actions. They want the banks to have greater liquidity by holding more assets they can immediately turn into cash in a financial crisis. They say they want to keep Wall Street banks that enjoy government backing from gaming the financial system with credit derivatives and other risk-inflated schemes, which even JP Morgan Chase’s own employees failed to catch until too late.”

Naturally, the banks will be fighting this with everything they have, and Goliath usually wins these fights in Washington. They’re already leaning on one of their favorite Senators, Chuck Schumer, to block Brown from ascending to Chair of the Senate Banking Committee. Nonetheless, the progressive-conservative alliance here suggests, at the very least, a new wrinkle in the game.

In related news, companies are also wheeling out the Big Guns to threaten the Securities and Exchange Commission over potential new corporate disclosure rules for political spending — namely, making businesses disclose their campaign donations to their shareholders. Seems innocuous enough, but of course, “[t]he trade associations lining up in opposition to the rule amount to a roll call of the most politically influential — and highly regulated — industries in the country.”

Forty Years and Counting.

“The cultural climate is far different today, besides. Now, roughly 75 percent of Americans support an end to Don’t Ask, and gay issues are no longer a third rail in American politics. Gay civil rights history is moving faster in the country, including on the once-theoretical front of same-sex marriage, than it is in Washington. If the country needs any Defense of Marriage Act at this point, it would be to defend heterosexual marriage from the right-wing ‘family values’ trinity of Sanford, Ensign and Vitter.”

The NYT’s Frank Rich reflects on the gay rights movement on the 40th anniversary of Stonewall. “No president possesses that magic wand, but Obama’s inaction on gay civil rights is striking. So is his utterly uncharacteristic inarticulateness…It’s a press cliche that ‘gay supporters’ are disappointed with Obama, but we should all be.“

Spitzer’s Out…Hubris or Death Wish?

“I am deeply sorry that I did not live up to what was expected of me. To every New Yorker, and to all those who believed in what I tried to stand for, I sincerely apologize. Over the course of my public life, I have insisted — I believe correctly — that people regardless of their position or power take responsibility for their conduct. I can and will ask no less of myself. For this reason, I am resigning from the office of governor.” Spitzergate comes to its inevitable close as the Governor resigned this morning, paving the way for Lt. Governor David Paterson to take office in Albany. (Yes that means Clinton -1.)

I know that some Dems have argued that Spitzer shouldn’t resign, citing David Vitter in particular, and that something is fishy about the Dubya Justice Department’s handling of this case. To be sure, I haven’t been relishing the unsightly upsurge in schadenfreude among the GOP, Wall Street, and exactly the type of corporate ne’er-do-wells Spitzer spent a lifetime fighting.

But, let’s get real here: Spitzer’s actions weren’t only brazenly and colossally dumb, they were patently illegal. Now, one can question the purported immorality of the world’s oldest profession, and I would be among those who think it’s a relatively victimless crime, situations like human trafficking excepted. But given that Spitzer is a guy who’s personally put people in jail for prostitution and then condemned them in the press, this would seem to be a no-brainer. He had to go down for this, or he would have put himself above the law. So whether or not Spitzer had well-connected political enemies — and, of course, he does — is somewhat beside the point here. The real problem here is that Gov. Spitzer was so unfathomably stupid as to engage in illegal acts that he — better than virtually anyone else alive — knew would result in his downfall. And the tragedy is that, given what Spitzer might’ve accomplished in office otherwise, everyone now pays the price for his apparent inability to restrain his appetites.

Briefing Encounter.

“‘This makes it perfectly clear once again that this disaster was not out of the blue or unforeseeable,’ said Sen. David Vitter (R-La.)…’It was not only predictable, it was actually predicted. That’s what makes the failures in response — at the local, state and federal level — all the more outrageous.'” A newly released video shows a typically incurious Dubya being warned — before Katrina hit — that the New Orleans levees might break. Of course, we already knew Dubya lied about the levees, but, still, a picture is worth a thousand words.