We will have another financial meltdown and perhaps another taxpayer bailout of too-big-to-fail banks, banks even bigger than they were in 2008. Why another meltdown?

The greedfest was hardly interrupted. Bonuses and casino capitalism continue. On the morning of July 21st, 2010, it was already evident.

On that morning, Barack Obama triumphantly signed the Dodd-Frank Wall Street Reform and Consumer Protection Act – a package designed to prevent another spectacular financial collapse. Standing by were some 3,000 lobbyists who had spent over $1 billion to battle against the legislation for months, favors and tacit bribes in hand. They were front men and women for the most powerful Wall Street institutions, corporations like Goldman Sachs, JPMorgan Chase, Wells Fargo and Citigroup, who not too many months before stood before Congress and President Bush pleading for help.

No sooner did Obama sign the legislation than Annette Nazareth, representing Goldman Sachs and JPMorgan Chase — among others, dispersed her plans to undo the bill. The other key figure plotting Dodd-Frank’s demise was Eugene Scalia, son of the quarrelsome Supreme Court Justice, Antonin Scalia. Eighteen working groups were each assigned a regulatory element of the law to gut, including derivatives, the Volcker Rule and the new Consumer Financial Protection Bureau (CFPB).

How is it possible to thwart a reform act already passed?

Saving indolent lawmakers a research effort, Dodd-Frank left the tough work of researching and writing the actual regulations to existing federal agencies — some mere puppets of powerful banking interests. There was the Wall-Street-friendly Federal Reserve, the Securities and Exchange Commission (SEC), which failed miserably to protect the public interest before the 2008 crash, and the Commodity Futures Trading Commission (CFTC), which did little to regulate the derivatives market, the actual center of the collapse.

To be fair, Republicans and Democrats alike deregulated banks, enabling their casino role, but Republicans did all they could to keep them deregulated, trying to blow up Dodd-Frank at every turn. With more of a majority now, they labor intensely in that direction.

It’s the old one-two punch. One, the Nazareth-Scalia team has orchestrated eighteen punches in the gut of federal agencies through their working groups of thousands of paid despoilers. Worker bees, lobbyists, and lawyers infiltrated, compromised, twisted and sued the federal agencies that were attempting to set the rules.

One priority was gutting, or making toothless derivative reform. Just five banks – Goldman Sachs, JPMorgan Chase, Citigroup, Morgan Stanley and B of A – have a 95% share of a derivative market that gives them some $50 billion in annual revenues. Regulating derivatives is critical because they were central to the 2008 collapse. Therefore, an agency that regulates them, the CFTC, long staffed by revolving-door, Wall Street lackeys, is mauled, manipulated, and litigated by lobbyists and their lawyers. The mere public trustees were outspent over a 1000 to one and intimidated daily.

More importantly, now there are five derivatives-related bills working their way through the House Financial Services Commission that the Republican-controlled House will surely weaken by stripping the functions of funds, arguing the need for austerity. Even Democrats are wimping out under pressure by lobbyists swarming Capitol Hill.

In the meantime, the banks that created risky amalgams of mortgages and loans during the boom – the same kind that went so wrong during the bust – are busily reviving the same types of speculation that we thought were gone. There is no regulation of structured financial products. So far this year, for example, banks have issued $33.5 billion in bonds backed by commercial mortgages, which is more than in 2005. There are no additional protections of investments, nor restrictions on the same kind of casino dealing occurring when real estate was flying high. We are allowing the old excesses.

Accordingly Dodd-Frank has had little impact, in fact, has not yet been implemented. How much chance do you suppose the people have in getting the agencies, often staffed by Wall Street allies, to regulate commodities trading where speculation causes wild swings in oil, wheat, and grain prices – and unshackled profits? Consider that a few months after Wall Street led us to financial Armageddon, banks have returned to the same risky practices. Some banks have already lost on risky ventures, and some have engaged in criminal activities.

Will agencies tighten up rules to provide a new Volcker Rule that would prevent the next JPMorgan embarrassing $6 billion loss on risky speculation: Jamie Dimon, JPMorgan Chase’s arrogant CEO, oversaw this fiasco? What about the next Mexican gang drug laundering scam, after the one instigated by Wachovia Corporation later bought by Wells Fargo in 2008? This time, last December, it was by a London-based American bank, HSBC, which was slapped on the wrist with a fine of $1.9 billion.

The fiascos get bigger and bigger. We forgot about the S&L crisis, due to deregulation, costing taxpayers more than $100 billion in the 1980s. Now are we going to forget about the Wall Street scam that took some 40% of the middle class’s net worth away and robbed a whole generation of social investments like infrastructure, education, and decent wages?

Should we throw extra money in the tax collection for the next Wall Street crash?

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