I was reading the business pages of the New York Times today, and I caught an article at the bottom of Page B3 entitled “Vote Backs a Financial Oversight Body.”

And I thought, great, finally, we’re going to get some much-needed regulation of the banks.

But then I read the fine print.

And it turns out there’s less here than meets the eye.

And that’s because, as the article noted, “a group of Democrats [in the House] with close ties to the banking industry” succeeded in diluting the bill in Barney Frank’s Financial Services Committee.

Originally, the bill would have granted wide authority to the states to regulate banks more vigorously than the federal government has been doing.

But the Democrats in the back pocket of the banks, along with Republicans in the front pocket, didn’t want those pesky states to be able to tell the banks what to do.

So they tried to outlaw entirely the rights of states to impose stiffer regulations.

The House ultimately compromised by allowing the Comptroller of the Currency to override the state regs if they are “significantly” at odds with the federal regs.

Well, what does “significantly” mean?

And why should the Executive Branch be the one to decide this issue?

We’ve seen the catastrophic results that ensue when the Executive Branch is the final word on bank regulation.

Michael Hirsh of Newsweek points out another warping of the bill by the House Democrats. Turns out that Wall Street will still be able to trade some derivatives in the dark.

“Thanks to weeks of intense pressure from Wall Street banks and their customers in corporate America, the bill that was approved on Thursday by Rep. Barney Frank's Financial Services Committee is riddled with exceptions and loopholes, many critics say,” Hirsh wrote. “If it becomes law, Wall Street's finest could be driving truckloads of new derivatives products through those loopholes for years to come.”

So, after Wall Street destroyed the U.S. economy by gambling on derivatives, the Democrats in Congress still are failing to muster the necessary backbone to thoroughly regulate them.

What Sen. Durbin said of Congress a few months ago is still true today: “The banks own this place.”