So what does a US Supreme Court decision overnight have to do with plans by President Barack Obama to revamp US banking and health care,  plans to regulate greenhouse gas emissions and crack down on takeovers and mergers?

A lot, in fact a huge amount.

Of all the decisions of the conservative-dominated Supreme Court has made in recent years, the one overnight, which has lifted decades of restrictions on US companies financing direct political activity, is the most important. It is going to send up the already obscene cost of US elections.

The court ruled 5 to 4, with all George W. Bush’s conservative appointees lining up on the affirmative, to overturn several important precedents (how’s that for the conservatives being radicals?) in a decision that was yet another defeat for the Obama Administration and supporters of campaign finance laws who said that ending the limits would unleash a flood of corporate money into the political system.

The ruling will transform the American political landscape and the rules on how money can be spent in this year’s Congressional election and the 2012 presidential contest.

“Writing for the majority, Justice Anthony Kennedy said the limits violated constitutional free-speech rights,” Reuters reported.

“We find no basis for the proposition that, in the context of political speech, the government may impose restrictions on certain disfavored speakers.

“In his sharply worded dissent, Justice John Paul Stevens wrote, ‘The court’s ruling threatens to undermine the integrity of elected institutions across the nation’.

“The justices overturned Supreme Court precedents from 2003 and 1990 that upheld federal and state limits on independent expenditures by corporate treasuries to support or oppose candidates.”

With Obama’s health-care proposals in trouble after the Democratic Party lost its absolute majority in the Senate, with plans to impose a tax on banks for the next 10 years and with plans, revealed today, to brake up some of the country’s biggest (and the world’s) banks, the High Court ruling will spark a surge in direct spending, on top of the half-a-billion dollars already spent this year by US banks and their industry on trying to defeat proposed legislation.

Hundreds of millions of dollars have already been spent by health-care groups, drug companies, insurers (and unions and proponents in favour of the Obama proposals). Now big companies will be able to spend directly and to their heart’s content.

The stratagems adopted to get around campaign restrictions will not longer be needed (limits of $1000, $2000). America now faces a grubby dash for cash that will further devalue the political process.

The health care and the bank proposals will be the ones most in danger (along with legislation to give unions more powers).

The bank proposals represent a significant toughening on what the Administration proposed last June (did the loss of Senator Edward Kennedy’s seat have anything to do with that?). Obama has accepted many of the proposals of Paul Volcker, the former Fed chairman from the 1970s and ’80s, who crushed inflation for Republican hero Ronnie Regan.

Instead of a light revamp, the Obama proposals will now effectively force finance firms to choose between proprietary activities, trading in stocks and sometimes risky financial instruments and commercial activities, such as being old-fashioned banks and making loans and collecting deposits.

The changes need Congressional approval and if they are, would stop banks or finance institutions owning, investing in or sponsoring hedge fund or private equity funds. The President said in his announcement that he will close loopholes that let finance firms trade risky products.

But it will also generate an orgy of spending on elections and lobbying from these same banks, many of whom were saved by the American taxpayer. All thanks to a partisan, conservative-dominated High Court.