WASHINGTON ( TheStreet) -- Wall Street will take aim at the proposed "Volcker rule" on Thursday, with several big bank executives prepared to testify ahead of a Senate Banking Committee vote.

Under the plan, large commercial banks would have to halt any capital markets activity that does not directly serve customers. Proprietary trading, investment banking advisory services, and anything having to do with hedge funds or private equity, would be prohibited activities at the country's largest banks.
Paul Volcker
Paul Volcker

President Obama supports the notion, which has been outlined and advocated by former Federal Reserve Chairman Paul Volcker, who is now one of his top economic advisors. But Wall Street, unsurprisingly, is not a fan.

The most diverse banks, like Bank of America ( BAC), JPMorgan Chase ( JPM) and Citigroup ( C), would need to determine how to hack off huge chunks of their operations, or simply close certain shops. It's unclear how the changes would affect others, like Goldman Sachs ( GS) and Morgan Stanley ( MS), but they would presumably need to get rid of their banking charters to continue business as usual.

The entire speculative industry -- bank or not -- will face much stricter scrutiny whether Volcker succeeds or not.

On Tuesday, Volcker and Deputy Treasury Secretary Neal Wolin spent the better part of three hours outlining the benefits of the proposal. Despite Volcker's urgent tone and his assertion that breaking apart commercial and investment banking is the only way to effectively reform the industry, some members were skeptical.

Ranking Republican Richard Shelby, of Alabama, was clearly opposed to the measure, launching questions that were condescending in tone. Committee Chairman Chris Dodd (D., Conn.) didn't necessarily disagree with the reforms, but indicated that adding another restrictive measure after months of partisan bickering over a broad reform proposal, would only delay progress.

"I don't want to be in a position where we end up doing nothing because we tried to do too much at a critical moment," said Dodd.

Today, three Wall Street top guns, and two professors who support alternative ideas, will testify before the committee, to explain why they think the Volcker rule is off the mark.

They include Gerald Corrigan, a former New York Fed president, who is now a managing director at Goldman; John Reed, the retired Citigroup chairman; Barry Zubrow, chief risk officer at JPMorgan Chase; Hal Scott, a Harvard Law School professor who also sits on Lazard's ( LAZ) board; and Simon Johnson, who published a blog post on the New York Times Web site on Thursday titled "Even Better Volcker Rules."

After that, the committee will vote on the issue.

-- Written by Lauren Tara LaCapra in New York

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