Last week in banking:

Our leading financial institutions announced that they had actually made a profit in the year's first quarter through the creative manipulation of rules and regulations; lobbied Congress to preserve their ability to raise credit card interest rates just for the heck of it and opposed the administration's plan for restructuring Chrysler, which would save some jobs and honor pension obligations, in the hope that they can redeem the company's bonds at a higher level than they're trading at just now. And, to round out the picture, The Wall Street Journal reported this week that lending at the 19 largest TARP recipients was 23 percent lower in February — by which time these banks had received hundreds of billions of dollars in public funds intended to enable them to lend more — than it had been in October, before the floodgates of tax dollars had been fully opened.

This is what our major banks are up to at a time when it is our largess that is keeping them afloat.

The week began with a burst of creative accounting. Citigroup, into which we've sunk more dough than any other company, with the possible exception of AIG, claimed a profit for the first quarter of this year because its bonded debt has lost value, which under the rules of accountancy enabled it to register a one-time gain equal to that lost value, because Citi could, in theory, buy back its own bonds for less. J.P. Morgan Chase, whose fire-sale purchase of Bear Stearns we taxpayers backed, declared a similar profit because of a similar decline in bond value.

As events would have it, the very same Citigroup and J.P. Morgan Chase are the lead negotiators for the banks that are objecting to the Obama administration's efforts to restructure Chrysler. Chrysler's bonds, which these banks hold, are trading at 15 cents on the dollar, the amount the government offered to pay the banks in its initial proposal to restore the company to viability. This week, the government upped that amount to 22 cents, plus a 5 percent equity share in the company. Citigroup and J.P. Morgan Chase, however, insist that they and their fellow banks are entitled to more, though that "more" could only come at the expense of Fiat (the auto company that is providing the new car lines and technology without which Chrysler will fold) or the company's retirees (to whose healthcare fund Chrysler is legally obligated) who built the company, or the taxpayers who are keeping Chrysler alive.

The banks' lobbyists, meanwhile, have been hard at work, too. Bills to limit credit card fees and penalties — my favorite fee is the one banks charge some customers for making (not missing, MAKING) a payment — are moving through both houses of Congress, but the Senate version has yet to receive any support from Republicans.

President Obama told representatives of the major banks this week that he backs the limits on credit card charges. The question here is whether the administration and congressional Democrats will use this issue to go after the Republicans, whose decision to align themselves with the banks, particularly on the issue of credit card fees, is incomprehensibly dumb even by their standards. If the Democratic Senate and House campaign committees don't run against the Republicans for backing the moral sewer and economic disaster that is our modern banking industry, they will be derelict in their political duties.

And that should just be the beginning. The Democrat in the White House and the Democrats on the Hill are committed to legislation that regulates our dysfunctional wards in the banking industry, but regulations by themselves won't solve the problem of the banks being too big to fail — and so big that they dominate campaign finance and, with it, much of the business of lawmaking. We need to amend our antitrust laws so we can scale down banks to the point that they no longer imperil our economic and political systems. As things stand now, it's we who are serving their needs, not they who are serving ours. It's time to turn that around.

Harold Meyerson is editor-at-large of American Prospect and the L.A. Weekly. He wrote this commentary for The Washington Post.