Tuesday, June 08, 2010

Obama Talks More About Financial Crisis than Oil Catastrophe

The President threw loose change into oily Gulf of Mexico waters on the Today Show. He spoke more about finances than leaking wells in his interview:

Matt Lauer: This is what happens when we have a disaster at one well. There are thousands of them (wells). You must've spent alot of time thinking, what would happen if there were multiple failures at one time?

President Obama: It is a huge problem, both in terms of the SEC and right now, in terms of the oversight of oil.

Note President Obama's tying the September 2008 financial crisis to BP's April 20 Deepwater Horizon rig blowout, clearly an attempt to anchor responsibility on the Bush administration. Most of Wall Street's imploded products stood outside SEC responsibility. This sounds like Axelrod/Emanuel framing.

Obama's answer to the multiple well leak question ignores the Ocean Saratoga, a second leaking well in the Gulf of Mexico. Federal documents confirm the smaller leak has been going since April 30. But the President straw manned on:

President Obama: The regulations that were in place were inadequate to prevent against worst case scenarios and big risks. Everybody was saying there's no housing bubble, the stock market's fine, and any attempts at regulation is anti free market, until the entire thing broke down. And then, the federal government is expected to come in and clean the whole thing up. And as soon as its cleaned up, get off our backs, we don't want to reregulate. So now, during our financial regulations debate in Congress, some of the same folks who were resisting regulation before are back at it, saying you can't meddle in the markets.

Well, the same thing's going to happen on this oil issue. What you're going to start seeing immediately is, we say we've got to tighten up regulations on the oil companies. There's going to be a lot of hue and cry about the Obama administration trying to meddle too much in the market. The point I want to make is this, and I think the American people deserve a good debate about this, I am a believer in the free market. I'm a believer in the stock market. I'm a believer in financial sophistication to potentially improve economic growth in our economy.

Translation: I believe in everything that failed miserably and limped back to date. Obama waved the flag, got some resonance going, then he delivered the punch.

President Obama: I believe we are going to need to increase domestic oil production, but we can't do these things unless we've got confidence that somebody's looking over the shoulder of these folks, because these systems are now too complicated for us to simply say, you know what, you can go do what you want. The consequences of catastrophe now are much larger than they have ever been and you've got to have a government that can oversee these folks in a serious way.

Obama's Oil Catastrophe Commission has its charge. ConocoPhillips Board member William Reilly told the President of his financial conflicts of interest. It didn't matter. Obama made Reilly Commission co-chair, a signal to show responsible adults are in charge.

Reilly's temporary leave of absence from the ConocoPhillips board doesn't address his control of over $2 million in stock in a company with significant Gulf of Mexico deepwater discoveries. It may or may not impact his board compensation. The board could vote to pay Reilly for his time off for public service.

Major financial conflicts of interest are part of the game. Nobody declares those nowadays, at least not publicly. How gauche for anybody to bring it up...

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