It’s been over two months since the consumer-advocacy group Public Citizen issued a petition calling for the break-up of Bank of America Corporation (BAC), invoking powers granted to regulators by the Dodd-Frank financial-reform act. While Public Citizen has a compelling case for dismantling what amounts to a public menace, don’t expect a litter of mini-BACs anytime soon.

Instead, be prepared for a pushback campaign that would make Big Tobacco proud. Its stock villains will include that hardy figment of the plutocratic imagination, the rabid egalitarian who hates capitalism, hugs trees and has no earthly idea how economies actually work. You know the type – people like Alan Greenspan, Bill Kristol and Jon Huntsman. Yes, those are just some of the axe-wielding Bolsheviks calling for a break-up of too-big-to-fail banks, and they’re being egged on by fire-breathing anarchists like MIT economist Simon Johnson, Dallas Federal Reserve President Richard Fisher and FOX News’s Charlie Gasparino. With friends like these, who needs pitchforks?

Whatever you think of Too Big To Fail banks, this is one initiative that the Great Corporate Wind Machine can’t dismiss as some fringe-left pipe-dream – unless the center moves so far right that Rush Limbaugh starts to sound medicated. Indeed, principled conservatives everywhere ought to be piling on to this bandwagon, even if that requires the free-market heresy of conceding that TBTF is not the result of meddling bureaucrats picking winners and generally getting in the way. It’s what happens when government gets out of the way and leaves the picking to bankers. When the players make the rules, expect the sidelines to become goal lines.

We can already anticipate the corporate canards – like accusations of bankster-bashing and class warfare – that will go into heavy rotation if the Public Citizen petition gets traction. But the case against BAC has only partly to do with particular individuals and actual or alleged abuses. If BAC were run by Mother Teresa, its basic business model would still be problematic, as is that of any TBTF bank. When an industry thrives by putting innocent bystanders at risk or by generating socially perverse outcomes, and when it keeps itself on the scoreboard largely by paying lawmakers to neutralize prudential regulation, it poses an ethical problem greater than the sum of its questionable activities.

Digging In

Public Citizen’s petition may contain the seeds of a remedy for TBTF, but it will take a prolonged siege to administer. The bank lobby – well-funded and particularly deft in the obfuscatory arts – is already muddying the issue with hoary bromides from the official Pushback Playbook. An old favorite: mega-banks yield efficiencies too precious to sacrifice. Economists disagree about whether such efficiencies actually exist, but even if they do it’s not clear they’re worth the societal risk that TBTF poses. Wall Street wants you to believe that only financial Luddites question the virtues of bigness. But it was Alan Greenspan who argued that Fed research had found no such benefits in banks “beyond a modest-sized institution,” and it was Republican Jon Huntsman who wrote last year in The Wall Street Journal that “There is no evidence that institutions of [TBTF] size add sufficient value to offset the systemic risk they pose.”

If the efficiency argument doesn’t wash, there are always chestnuts like “downsizing our industry will make the U.S. less competitive in a global economy,” or “push us too hard and we’ll take our ball offshore.” Somewhere, John Boehner is memorizing the phrase “jobs-killing Public Citizen petition.” Meanwhile, banks are working the contrition angle. As BAC chief Brian Moynihan confided in December to the Boston Globe:

“We know that in the financial crisis, our industry had excesses. We all know that and we’ve said that. The whole industry has changed. We took a lot of risk out. Made the bank simpler. A lot of the [institutions] that caused problems are gone. The ones that are still here learned their lessons.”

Let’s dissect some of that. The “industry has changed”? Maybe. But it’s best to weigh the remorse of a mega-bank CEO the way you’d size up a hitchhiker in an orange jumpsuit. Departing Goldman Sachs director Greg Smith has little doubt about whether that particular firm has changed. Arguably, the industry is not even supposed to change. It gets paid to find new avenues of risk, and to stay three steps ahead of regulators.

“Learned their lessons”? Who has learned what? The people on trading floors and in executive suites 10 years from now won’t be the same people who were scorched in 2008. Absent a regulatory regime with teeth, the industry will have forgotten that there was ever a reason for Dodd-Frank – just like the folks who drop-kicked New Deal regulations out the window when laissez-faire swamp fever began to sweep the land. Greed will be good again, all will genuflect to the God of Shareholder Value, and IBG-YBG (“I’ll be gone, you’ll be gone”) will emerge unscathed as Wall Street’s tacit M.O.

It is true that Dodd-Frank aims to constrain risk-taking and replace bailouts with orderly liquidations. But the bank lobby’s locust horde was swarming over the law before the ink was dry, and by now it’s eaten so many holes in the Volcker rule (a provision that would restrict speculation by federally insured banks) that even its supporters doubt it can be effective. The rule was all of 10 pages when it went to Congress two years ago. At last count it was at 530, as Pro Publica reports, stuffed full of industry “exemptions” (known colloquially as “loopholes”). Closing the circle of self-serving logic, banks now argue that the rule is too big and too complex.

My Own Private S.E.C.

Bank size matters for at least two reasons. First, it’s the potential failure of big, densely connected institutions, not your isolated community lender, that is more likely to make financial markets panic. Markets being what they are – run by easily spooked herds whose worst fears can be self-fulfilling – the mere rumor of trouble at a money-center bank is enough to start a stampede. Second, as Simon Johnson has explained, the bigger and more influential financial institutions are, the easier it is for them to capture the lawmakers and regulators who are supposed to oversee them.

Breaking up BAC would represent a seismic shift in Wall Street-government relations, but we have moved such mountains before, among them Standard Oil and AT&T. The reasons then were restraint of trade rather than systemic risk, yet there is a precedent in both cases for overriding that most sacred article of laissez-faire faith: that the spoils of corporate excess accrue to one and all. (Just ask any Gulf Coast trawler captain how BP has enhanced his life.)

As recently as the 1970s, people scarred by the Great Depression still intuited why we put reins on Big Finance. But public consensus is a gullible beast, easily led down the memory hole by powerful interests and paid propagandists. By 2008, the righteous armies of market evangelism had worked their rapturous magic, and average folks could no longer recall why there was ever such a thing as financial regulation. Until they were reminded the hard way.

What’s needed here is some sort of moral lodestar, something to get a bead on next time the laissez-faire riptide starts sweeping common sense out to sea. So permit me to invoke what I’ll call the G.K. Chesterton Rule, after the late British author credited with this jewel of prudential wisdom:

“Don’t ever take down a fence until you know the reason it was put up.”