Bush digs himself into a hole and keeps digging

The President started last week trying to save corporate America. He ended it trying to save himself.

"My friends are crooks. The companies they run look corrupt. The regulators I appoint are too soft. My colleagues in government face lawsuits for fraud. But I'm going to solve corporate crime with some ass-kicking laws. Hey, and trust me, I'm the President."

After a week in which markets globally were badly wounded by the Dow -- which fell 700 points, dragging the FTSE down by nearly 400 -- it is clear that not only Americans but people around the world are in no mood to take George W Bush and his promised crusade against corporate corruption on trust. In fact, the attempt to appear tough on WorldCom, Enron, Andersen and the rest ahead of mid-term elections in November turned out disastrously.

Day 1: Bush held a rare press conference to gain the initiative a head of his key Wall Street speech. Instead, he was rocked onto the defensive over allegations concerning his own financial dealings in the oil company Harken Energy.

Day 2: In Tuesday's speech, Bush said "too many corporations seem disconnected from the values of our country". He listed measures, including a task force that would be a "financial crimes Swat team," anti-shredding laws, a US$100 million boost for the Securities and Exchange Commission, the forfeiture of pay gained by deception, greater accountability for CEOs, and an increase in prison terms for fraud to ensure "those who breach the trust of the American people are punished".

It read like a plea for credibility. It was snubbed. Democrats, led by the presidential hopeful Tom Daschle, ridiculed both the rhetoric and substance, highlighting Bush's refusal to endorse a tough package of laws being proposed by a Democrat, Senator Paul Sarbanes. Bush was the "unconnected" one. As the Dow slid, a Democrat aide said: "The markets clearly don't think he has gone far enough, and neither do we."

Then it got worse.