Today's Outrage is published weekdays at 9:30 a.m. EDT and is available as an RSS feed.

The Obama Administration wants the biggest of the big banks to start planning their own funerals.

Any bank such as Citigroup ( C), Goldman Sachs ( GS) and Bank of America ( BAC) that is considered too big to fail because of its size, leverage or the degree that its operations are interwoven into the fabric of the entire financial system would need to draft detailed plans for unwinding their operations should it ever come to that.

An analysis of the administration's proposed regulatory overhaul by the Associated Press concludes that the new scrutiny, larger cash cushions and asset requirements that the administration desires are intended to limit the number of systemically risky financial institutions by making it unappealing to get that big.

Essentially, the proposed requirements would pressure the financial system to deconsolidate -- a classic knee-jerk reaction to the financial bailout intended to make it less likely to be repeated.

Much like the bailout itself, these hastily concocted hangover cures may have many unintended side effects. The cure may eventually make us all feel worse than the sickness ever did.

It reminds me of the environment of corporate misdeeds that prompted the onerous Sarbanes-Oxley rules. What a mess that turned out to be -- even former Sen. Paul Sarbanes (D., Md.) and former U.S. Rep. Michael Oxley (R., Ohio) later told me that they regretted the extent of the regulatory changes they championed.

So here we go again. This time, everyone should all read the fine print and fully understand what they are signing, in particular the consequences.

What will happen if General Electric ( GE) is forced to exit from its GE Capital unit because of proposed limits on combined banking and commerce operations? How will the struggling car industry be impacted if Ford ( F), General Motors ( GMGMQ), et al. aren't able to provide financing to prospective buyers?

And just how many major institutions do we want to be trying to unload sundry parts of their operations to escape excessive government interference?

It seems like quite the muddle already with AIG ( AIG), Bank of America, Citi and others all trying with varying degrees of success and failure to sell pieces of their far-flung empires in order to repay taxpayers.

Pretty soon, President Obama may need to grab a gavel and add a new title to his resume -- "Auctioneer in Chief."

Or maybe "Undertaker in Chief" -- considering his desire for banks to plan their own burials.
Glenn Hall is the editor of TheStreet.com. Previously, he served as deputy editor and chief innovation officer at The Orange County Register and as a news manager at Bloomberg News in Frankfurt, Amsterdam and Washington, D.C. As a reporter, he covered business and financial markets, worked in both print and television in the U.S. and Europe, and conducted in-depth investigative coverage at The Journal-Gazette in Fort Wayne, Ind. His work also has been published in a variety of newspapers including The Wall Street Journal, The New York Times and International Herald Tribune. Hall received a bachelor's degree in journalism and political science from The Ohio State University and a certificate in project and program management from Boston University.

If you liked this article you might like

Citi Will Refund $335 Million in Card Charges: LIVE MARKETS BLOG

Citi Will Refund $335 Million in Card Charges: LIVE MARKETS BLOG

Financial Stocks Make Great Buys After the Recent Market Downdraft

Financial Stocks Make Great Buys After the Recent Market Downdraft

This Is the Perfect Time to Buy Dividend Stocks

This Is the Perfect Time to Buy Dividend Stocks

Citigroup Gives CEO Corbat 48% Pay Raise as Profitability Misses Goal

Citigroup Gives CEO Corbat 48% Pay Raise as Profitability Misses Goal

Worst-In-Class Goldman Sachs CEO Blankfein Gets 9% Pay Raise

Worst-In-Class Goldman Sachs CEO Blankfein Gets 9% Pay Raise