On May 21, the Senate voted to pass an overhaul financial regulations in response to the financial crisis that brought on the Great Recession. The House of representatives passed their version of financial reform months ago. Progress is being made, but the job is far from done.

As you may recall, merely passing the two houses of Congress is not all it takes for a bill to become law (or if you're not from the School House Rock generation, this chart shows the lawmaking process about as clearly as it can be presented). Conference committee to combine the House and Senate version, a vote in the House and votes in the Senate on the unified bill remain before financial reform makes it to the President's desk.

The conference committee schedule has been set in the hope of getting President Obama's signature on a financial reform bill before the July 4th Congressional recess. The first meeting will be this Thursday June 10th. And thanks to the pressure from many reform-minded activists and the public, much of the negotiations will be open to the public and televised. You can watch live at SunlightFoudnation.com with context about committee members top donors.

Whatever the result of the conference committee, the law that emerges will not end the need for systemic reform of the financial industry. The House and Senate bills have many good things in them but leave many of the problems with the financial sector entirely unaddressed.

James Kwak explains the need for financial reform beyond the current measures. He cites Paul Krugman and others in explaining that Congress is doing some good to address the short term problems but is leaving most of the long term structural problems in place. Chief among them is the overall size of the financial sector.

Krugman makes the point clearly in a post featuring a chart of the financial industry share of domestic profit. As the Nobel winning economist puts it:

We got into this mess because we had an over-financialized economy, with finance making a share of profits out of all proportion to its actual economic contribution. And now it’s baaaack.

The current financial reform effort has merits (consumer financial protections and Say on Pay rules to name two). Policy makers needs to pass the bill and get right back to work on cutting the financial sector down to size.