By William K. Black
(Written for CNN Opinion)
JPMorgan Chase can be considered a systemically dangerous institution, which means that it is “too big to fail” because the government fears that its collapse would cause a global financial crisis.
It is simply irrational to allow such an institution to exist, especially when it can easily incur a $2 billion trading loss.
Banks are more efficient when shrunk to the point that they can no longer endanger the world economy. But because JPMorgan and similar banks are the leading contributors to Democrats and Republicans, neither political party has the courage to order them to reform.
The Volcker Rule, which aims to prevent insured banks from engaging in speculative bets, was passed as part of the Dodd-Frank Act over the objections of Treasury Secretary Timothy Geithner and almost the entire Republican congressional delegation.