Reading Obama 4

Listening to Obama, I often think of the nervous comment of Michael Banks when he meets Disney’s Mary Poppins for the first time. “We better keep an eye on this one. She’s tricky.”

Here’s Obama at his trickiest:

"Nor is the question before us whether the market is a force for good or ill. Its power to generate wealth and expand freedom is unmatched, but this crisis has reminded us that without a watchful eye, the market can spin out of control - that a nation cannot prosper long when it favours only the prosperous."

The crashes in the housing markets, credit markets, and stock markets have exposed many terrible abuses, some of which genuinely could have been prevented by closer supervision and better regulation. Bankers play with other people’s money, and that will be more true than ever after the government take-over of Fannie Mae and Freddie Mac and the huge extension this fall of government protection of deposits and credit. More regulation of all that is inevitable and at least arguably desireable.

But it’s very ambiguous, isn’t it, whether Obama means those particular financial markets when he speaks of “the market” and its need for a more “watchful eye” – or whether he means the whole private economy. The phrase “Its power to generate wealth and expand freedom” describes all free-market activity, not only financial activity. How much of that does he intend to police more tightly? As Michael said: Tricky.