Johnson and Calomiris debate whether to break up big banks—probably the biggest open question remaining since the financial crisis.

At a stroke, the proposed law would force global megabanks such as JPMorgan Chase and Bank of America to become smaller and much simpler -- divorcing high risk activities from plain-vanilla traditional banking.

The dangers of reckless behavior by global megabanks are now understood much more broadly. And Brown-Vitter provides an appropriate road map for addressing some of the core problems and making the financial system significantly safer.

Johnson discusses financial reform, Too Big to Fail, and America’s huge national debt.

The true conservative agenda should be to take government out of banking by making all financial institutions small enough and simple enough to fail.

Too-big-to-fail banks should be made smaller, and preferably small enough to fail without causing global panic.

With unemployment obstinately high and fiscal policy on ice, the Federal Reserve will continue to push down long-term interest rates. Further rounds of quantitative easing will tend to weaken the dollar. This is a much more effective way to move our currency than any foreign-exchange market intervention.

Clearly, the Fed chairman recognizes the severity of the problem and has decided to do whatever it takes to prevent anything like the Great Depression from happening again. Given where we are today, that means printing money, even if that runs the risk of creating a serious inflation problem.

In our view, the Fed’s current “print the money” strategy (and, yes, I know the Fed doesn’t like this term or even “quantitative easing”) is make-or-break for turning the economic corner any time soon. It’s incredibly risky in terms of potential inflation – more than the Fed would ever concede – but preferable to all the available alternatives.