The Obama administration deserves the nation’s thanks for standing up to the financial industry and its army of lobbyists on a matter of principle as well as practical importance: holding financial advisers accountable to their clients. Secretary of Labor Tom Perez refused to back down from a rule he proposed that would require financial advisers to act in the best interests of their clients. The rule simply requires advisors to provide what most clients probably already think they are receiving: advice about their retirement plans untainted by conflicts of interest. It would prohibit common practices such as steering investments to companies that pay the adviser a commission.

This rule would seem to be a no-brainer, but the industry makes billions of dollars from conflicted advice, and it’s used to getting its way. So the outcome of its efforts to kill the fiduciary rule was uncertain until yesterday, when it was revealed that an amendment to block the fiduciary rule was left out of the House omnibus appropriations bill.

In essence, the opponents of the fiduciary rule want to preserve a system that allows financial advisers to give their clients advice that is in the adviser’s interest rather than the client’s. Conflicted advice can cause real losses for the clients who are victimized. According to the Council of Economic Advisers

Conflicted advice leads to lower investment returns. Savers receiving conflicted advice earn returns roughly 1 percentage point lower each year (for example, reducing what would be a 6 percent return to a 5 percent return)

A retiree who receives conflicted advice when rolling over a 401(k) balance to an IRA at retirement will lose an estimated 12 percent of the value of his or her savings if drawn down over 30 years—$12,000 for a typical $100,000 rollover. If a retiree receiving conflicted advice takes withdrawals at the rate possible absent conflicted advice, his or her savings would run out more than 5 years earlier.

The Wall Street Journal boils the financial industry’s opposition down to an argument about the viability of firms that provide investment advice:

The financial industry has opposed the proposal, saying it would raise compliance costs and drive many financial advisers out of business while pushing investment advice out of reach of middle-class savers.

The obvious answer is that if a company can’t survive without taking advantage of its clients, it doesn’t deserve to survive. If the only “affordable” investment advice costs $12,000 in unnecessary losses, somewhat higher-priced advice from a real fiduciary would undoubtedly be a better deal.

My hat goes off to Assistant Secretary Phyllis Borzi and her staff, who worked hard for many years to issue the fiduciary rule and protect retirees from being cheated by the financial experts they hire to help them.