The Volcker Rule limits the ability of giant banks to destroy the economy. Their tool lobbyists explain how bankers stand for Truth, Justice, and the American Way of making money with taxpayer guarantees.

Occupy the SEC has submitted a very fine comment on the proposed regulations under the Volcker Rule. The proposed regs are weak, and Occupy calls the agencies out for their lax regulation. Someone represents the 99% against the interests of banksters and their lap dog lawyers.

This week marks the end of the public comment period on the Volcker rule. The usual suspects have all delivered their comments. The huge finance lobby delivered their mass of comments, in particular calls for multiple exemptions and waivers. But a new group, Occupy the SEC, a collection of experts in finance which sprung out of the Occupy Wall Street movement, delivered a 325 page letter to the SEC about the rule reminding the SEC about their obligations to the public.

If you needed to appeal to one authority on banking regulation, you could do worse than to consult Sheila Bair, the former chairwoman of the FDIC. And now she’s advocating scrapping the Volcker rule and starting over. She comes at this by looking at the spectacle of MF Global – a brokerage house that would not be covered under the Volcker rule – and asking whether they would be permitted to trade depositor funds on their own account if they were a bank. The answer is far less clear-cut than it should be – and that’s the problem with how the Volcker rule emerged from the sausage grinder of the regulatory apparatus.

The finance lobby wants to weaken the Volker rule that limits proprietary bets by regular banks. They find the weakest link in the regulatory chain and ride that link to achieve their ends. And the weakest link is usually the Office of the Comptroller of the Currency, colloquially known as the Office of Bank Advocacy.

In retrospect, the banks had a pretty sound strategy with Dodd-Frank: fight it during the legislative process, but not too hard, allowing lawmakers to think they’ve accomplished something. Then, during implementation, bend the regulatory apparatus to your will, gutting the law before having to follow it. That has been extremely successful, especially because Dodd-Frank wasn’t really a law so much as a promise to write a law later.

The latest victim of the finance lobby’s efforts on Dodd-Frank is the Volcker rule.

Basically, the banks successfully got the regulators to define “hedging” so broadly that virtually any proprietary trade could be seen as a hedge.

I see this as an opportunity to test a legitimate anti-bank populist message against a real opponent. Massachusetts may be a blue state, but Scott Brown has a 54% approval rating and will have scads of money to tout his record and distort his opponent’s. He’s already doing some of that, playing the role of faux-populist with New England Cable Network, pretending that he “worked very hard to make sure that banks didn’t act like casinos with our money.” The history is clear. He single-handedly watered down the Volcker rule to almost nothing, mainly to protect Mass Mutual and other state banks. He has been the recipient of hundreds of thousands of dollars of big bank largesse. This anti-bank claim he’s trying to make is untenable. And Warren knows it.

President Obama pulled off a neat trick with his announcement on regulatory streamlining yesterday. Initially, it earned praise from the right (they claimed it was their idea) and emnity on the left, even though it looked to be more of an announcement of general principles rather than any specific prescription. Then, when asked if the streamlining would incorporate the two major legislative goals of the Administration so far, health care and financial reform, both of which have a major regulatory component, they said no, the announcement had nothing to do with that. And that earned the emnity of the right and muted praise from the left. So as a result, nobody’s happy with this clear kabuki announcement.

It’s very important to keep on top of the implementation of the Dodd-Frank financial reform bill, because Congress basically outsourced the writing of the bill to the regulators. There are 67 studies and 200 rules that regulators will have to conduct, enact and implement. And so it’s worth looking into their progress, which has already begun.

Last night, Maria Cantwell announced her support of the Dodd Frank financial reform bill, citing a letter from Commodity Futures Trading Commission chief Gary Gensler ensuring her that the derivatives title will be rigorously enforced. Which begs the question: why in the hell did the conference committee give Scott Brown basically everything he wanted? Because Brown’s vote is now irrelevant.