According to the nytimes article, the proposal will likely include the requirement that you MUST have a backdoor in your encryption scheme. That effectively bans schemes without backdoors.
Not that this will ever pass as a law.
Of course, if there is a back door in all encryption between, say, businesses or minority political groups or anyone else who has legitimate reason to encrypt stuff, 1) there's the chance (very likely) that others will discover the back door, and 2) the government (or some of their employees) will probably abuse it at some point.
See, the whole point of encryption is to make your communications SAFE and eliminate these sorts of unknowns. It's a legitimate need, and just because it can be misused doesn't mean it shouldn't exist.
You did log the key for that https session when you used amazon checkout didn't you?