Three Suggestions for Banking Reform

I have a new commentary posted today on banking reform:

Too big to fail is a costly, problematic policy. And there are viable solutions to fixing this disease. But for a collection of political reasons, Washington is ignoring both the underlying problems and solutions. Sixteen months after the market meltdown of September 2008, not only does too big to fail remain, but the House has passed a bill that would set up a permanent bailout fund. Now the Senate has the opportunity to act on ideas put forth as real solutions to Wall Street’s size.

What would help President Obama fulfill his promise to end the policy of too big to fail?

In short, the president should use bankruptcy to wind down big financial firms that don’t fall under FDIC jurisdiction, have congress reform rating agencies, and consolidate banking regulations into one regulatory body.

See here for details on my ideas.