The following editorial appeared in the St. Louis Post-Dispatch on May 16:

Had the nation been more engrossed in what President Bill Clinton was doing with the financial industry in the mid-1990s and less in what he was doing with Monica Lewinsky, it might have avoided a whole lot of trouble.

In November 1999, having survived impeachment over matters related to l’affaire Monica, Mr. Clinton signed the Financial Services Modernization Act, aka, the Gramm-Leach-Bliley Act. This formalized a massive change in America’s banking practices that had been under way for several years, eroding distinctions between commercial banks, investment banks, brokerages and insurance companies.

Gramm-Leach-Bliley overturned key components of the Glass-Steagall Act of 1933, the New Deal’s attempt to bring banking under stricter federal regulation. Franklin Roosevelt, quoting his distant cousin Theodore’s line about “malefactors of great wealth,” imposed rules on them.

Under Glass-Steagall, the nation enjoyed nearly 50 years of prosperity. Commercial banks lent money. Investment banks did deals. Securities firms sold stocks and bonds. Insurance companies sold insurance. It worked.

But by the 1990s, these financial institutions increasingly were dabbling in other’s businesses. The banking giant Citicorp merged with the Travelers Group in 1998 to form Citigroup, betting that Glass-Steagall rules soon would disappear.

Robert J. Rubin, who was Mr. Clinton’s Treasury secretary and a former co-chairman of Goldman Sachs, was sympathetic to the argument that the financial industry needed the shackles removed, if only to compete with foreign banks. After government service, he made $126 million working for (wait for it) Citigroup.

The boom years of the 2000s seemed to validate his wisdom. The financial industry thrived. The world was awash in cheap capital.

Then came 2008. The big banks had used federally insured deposits to invest in exotic financial instruments backed by outrageous mortgages. The banks were leveraged far beyond what their capital holdings would support. The world financial system teetered on the brink.

Congress bailed out the banks. To make sure it wouldn’t happen again, new financial restrictions in the form of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2009 were passed. Dodd-Frank contained a sort of “Glass-Steagall lite,” called the Volcker Rule, saying that investment banks couldn’t trade on their own accounts.

As we saw last week when JPMorgan Chase announced a $2.3 billion loss on an exotic derivatives position, there is still work to be done. Jamie Dimon, the chairman and CEO of JPMorgan, and his fellow bankers have been complaining that Dodd-Frank went too far, even as financial industry lobbyists have been scurrying around Congress — and spending $253 million on political contributions in the current political cycle — gutting it before it gets started.

Big bankers have gotten used to obscene profits and absurd bonuses. Politicians of both parties — Democrats have received more than a third of the industry’s contributions — are eager to do their bidding. President Barack Obama has boasted about Dodd-Frank, but he hasn’t done much to make sure it stays intact.

Here’s a campaign slogan: Bring back Glass-Steagall. It was good enough for FDR. It was good enough for 50 years of prosperity. The money that is churning through international finance these days is doing just that — churning, creating profits, not jobs. It makes food and fuel and most everything else more expensive. It is an outsized Ponzi-scheme that enriches the few at the expense of the many.

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