The Associated Press looks at Obama’s regulatory-reform plan and finds reason for hope on its approach to tackling Too Big to Fail.

Up to now the consensus is that the administration’s approach has been to do a whole lot of nothing. The AP says, however, that “Financial regulations proposed by the president would result in leaner and simpler institutions that don’t carry the weight of the system on their marble columns.”

But while the report does point to some positive steps the administration says it will take, I don’t think the AP backs up its overall thesis. Here’s how it says the TBTF plans are tougher than everybody’s let on:

Under the administration’s proposal, companies such as Citi, Goldman Sachs and others in a broad top tier engaged in complex transactions would face stricter scrutiny and have to hold more assets and more cash as cushions against a downturn.

They also would have to anticipate their own demise, drafting detailed descriptions of how they could be dismantled quickly without causing damaging repercussions. Think of it as planning their own funerals — and burials.

“Stricter scrutiny” is pretty nebulous, and “planning their own funeral”—I’m not sure what good that does to rein them in. The only thing here that has the potential to really push companies to break themselves up is the increased capital reserves. Sorry if I’m not buying the idea that the Obama team will make these onerous enough to really matter.

It ain’t exactly a hard cap on total assets.

This next bit is cause for even more pessimism, yet more evidence of Obama’s love of the far-from-bold solution:

Obama’s plan, in short, aims to make it far less appealing to be so big. That was the middle ground the administration sought, a step short of an outright ban on systemically risky companies.

I don’t think you can just ban systemically risky companies, but you can make them less risky, which is what forcing them to radically slim down would do. The reimposition of Glass-Steagall would help, too.

I mean, let’s not over think this. It’s pretty simple, really, when you’re talking about clamping down on Too Big to Fail. Making them smaller makes them less likely to take down the system while making it easier (and less costly for taxpayers) to resolve the.

And a critical point: Administrations come; administrations go. Their stances toward enforcing regulations change. It’s much harder to change a law that limits size and/or interconnectedness.

This story smells a bit too much like administration spin to counter criticism of the gaping blind spots in their plans. As Ritholtz says, “I’ll believe it when I see it.”

Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu.