Warren Buffett Testifies Before Congress on Financial Crisis; Oil Crisis Grows; Israel Under Fire For Raid on Aid Ship
DREW GRIFFIN, CNN ANCHOR: But time for the closing bell. Poppy Harlow joins me now for the "CNN Money List." Poppy interviewed Warren Buffett just last hour. He had some interesting things to say and also interesting things to say about what he thinks caused the financial meltdown, right?</s>POPPY HARLOW, CNNMONEY.COM: Yes. It's very interesting, Drew. I'll tell you, this was the financial crisis inquiry commission. It's a congressional panel that's been set up. They have to report back to the president on December 15th. But they had to subpoena Warren Buffett to sit in front of them to testify about the causes of the crisis. They asked him twice in letters and he turned them down, and then they subpoenaed him. So I just sat through about two hours of testimony from Warren Buffett. The reason they want him to testify is because he's the single biggest shareholder in Moody's, one of the biggest rating agencies in the country and one of the companies that's blamed a lot for being at the crux of this financial crisis for not seeing the housing crisis. And it was very interesting to watch Warren Buffett sort of rush to the defense of Moody's and talk about the fact that it was a flawed system in general, not just Moody's, that he didn't even see the housing crisis to the extent that it became apparent it was, that the American public, that the media didn't see it. But I also talked to him, Drew, about financial regulatory reform, because as you know, that bill is likely to make it to the president's desk in a matter of weeks. He weighed in on that with some interesting insight. Take a listen.</s>WARREN BUFFET, INVESTOR: It will do some good but I think it would be more useful, obviously, if they could give their findings before Congress acts. It's like coming down with an 11th Commandment sometime after Moses has proclaimed ten. It's hard to get much attention paid.</s>HARLOW: Are we rushing Wall Street reform?</s>BUFFET: The demand is there. People are understandably enormously upset with what happened in the financial crisis. I think it's sort of inevitable that Congress pounds ahead and doesn't wait for something like this.</s>HARLOW: It's interesting, Drew. I asked him if they were rushing reform. He said that's basically a moot point. The question is you have the political momentum now. You just have to do it now, Drew.</s>GRIFFIN: Poppy, does he think that reform is not needed, that Wall Street is just going to behave now?</s>HARLOW: No, not at all. He's been one of the biggest advocates for it being needed. He's said it for years and years and he said it again today, Drew, in his testimony. He said CEO's need to be the chief risk officers in their companies. And if their companies have to be bailed out by the government as most of the big banks here in New York were, then those CEOs should go hope penniless and they should really be held accountable. And he sticks to the point that these CEOs really have to be accountable. He was asked about the CEO of Moody's, the rating agency that was sitting right next to him, how that rating agency did in handling all of this. And I want to play you some sound we just cut from the interview talking about the ratings agencies and whether they're at fault, whether they're at the crux of the crisis or not. Take a listen.</s>BUFFET: I think they've generally done a fairly good job, but I think they're limited in what they can do. I do not follow agencies' ratings. I don't follow stock pickers' recommendations either, equity recommendations. I think they have some utility, but I don't think that anyone should say a rating of AA today means it's going to be AA ten years from now.</s>HARLOW: Where's the social utility in rating agencies? Charlie Monger and you talk about social utility a lot. And the CEO of Moody's said we give these ratings to the public for free. Be what they also did is not just Moody's, but Fitch and S&P; and rating agencies across the country rated absolute junk with the highest possible ratings they could.</s>BUFFETT: If you look at the mortgage backed securities, it's a disaster. If you look at the record on corporates and municipals, it's hasn't been bad over the years. They're far from perfect, but they have been better than somebody that doesn't know anything about it. And one advantage they have is if you take -- just take insurance companies. If they could invest in anything they pleased, you would have -- you would have some buccaneers get into that business, take other people's money, and who knows what they'd do with it? So there's some utility in providing a check in regulated industries on what managers do with funds under their control that belong to other people.</s>HARLOW: So, as you heard, Drew, he said there's some social utility in what rating agencies do. He said be careful about finger- pointing. And that will do it for us. Closing bell on Wall Street, a nice day on the Street, up all session, the Dow closing up 228 points. A lot more from Warren Buffett, you can check it out on CNN Money, Drew, but very interesting to hear him. And it took a subpoena, but I'm glad we were able to hear him.</s>GRIFFIN: Yes, I'm -- I was going to ask you about that, but we're out of time, but why -- why he needs a subpoena to talk.</s>GRIFFIN: The guy has never been quiet before.</s>HARLOW: Yes. He basically said he gets all of these demands and if he said yes to everyone, he wouldn't have the time to run his company. So, he can't yes to everyone. So, yes, but he did respond to the subpoena, and he came and testified.</s>GRIFFIN: All right, very good. Poppy Harlow, thanks a lot. Well --</s>HARLOW: You bet.</s>GRIFFIN: Joran van der Sloot, the Dutchman once considered a suspect in the disappearance of Natalee Holloway, is the suspect in the killing of a woman in Peru. We're following new developments, and this:</s>GRIFFIN (voice-over): Here's what's making the LIST. As the oil sheen moves in to on the Gulf shores, plan A, B, C, D, E, F, G is under way. But is it working?</s>ADMIRAL THAD ALLEN, U.S. COAST GUARD COMMANDANT: That saw blade is becoming stuck inside the riser pipe. And is this creeping oil a creeping crisis for the Obama administration? Robert Reich, remember him, joins the list with his list of five reasons why the White House should take over BP. Anguish and outrage now against Israel's deadly raid on a ship carrying food and supplies to Gaza. We're asking the leader of the Free Gaza Movement why they're still challenging that blockade.</s>GRIFFIN: It's hour two. Time to pick up the pace, today's LIST for you. We're going to check on number one: another potential confrontation off Gaza. Just a short time ago, Israeli Prime Minister Netanyahu called an aid flotilla a threat to his country's existence.</s>BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER (through translator): This is a -- a very immediate existential threat to Israel. And I'm telling you and I'm telling you and I'm telling my friends in the countries that criticize us that a -- an Iranian port in the Mediterranean will cause an immediate danger to the countries -- to the European countries and to other countries. Therefore, we will stop and check and examine every ship that is coming to Gaza, and this is what we did.</s>GRIFFIN: Greta Berlin is co-founder of the Free Gaza Movement. That's one of the organizations behind the aid flotilla whose boat was involved with that clash with Israeli troops Monday morning. You have more ships on the way, Greta. When will they arrive?</s>GRETA BERLIN, CO-FOUNDER, FREE GAZA MOVEMENT: Well, first of all, they didn't attack one boat. They attacked all six of our boats.</s>GRIFFIN: Greta, let me ask you a question. We're talking about the boat that's on the way. When -- is that literally on the way right now, and when will it arrive?</s>BERLIN: The boat is on its way, but, after Israel yesterday said that they had sabotaged two of our other boats, we're really not going to tell you, anybody, right now where it is, because we don't want any more sabotage to the boats, because this boat has 1,200 tons of vitally needed supplies for the people of Gaza, and we want to make sure we get it delivered.</s>GRIFFIN: Well, with the -- with the history now that we have in the last two days, and the violence and the deaths, I'm asking why you would put your boats and your people, specifically, on those boats directly into harm's way, knowing right now from Benjamin Netanyahu that they are going to be stopped and they are going to be searched?</s>BERLIN: Because Israel has no right do this. We're challenging Israel's right to put a blockade up on 1.5 million Palestinians and -- and commit slow-motion genocide against them. This is what we're challenging. We are a civilian initiative. Israeli soldiers came on board all of our boats, not just one, and brutally murdered at least nine people, maybe a few more. We don't -- we're not sure yet. And, so, you should really be asking yourself, what right does Israel have to do this in international waters?</s>GRIFFIN: Does Israel -- Israel have a right to defend itself from potential bombs, rockets, artillery, guns getting to Gaza through boats like yours?</s>BERLIN: Of course it does, but every single piece of cargo that we had on all of those boats were not only inspected at the ports where they left, but had individual and independent inspectors look at that cargo. Our cargo --</s>GRIFFIN: But they -- they were not inspected by any kind of Israeli official?</s>BERLIN: Why -- absolutely not. We wouldn't trust Israel.</s>GRIFFIN: And Israel wouldn't trust you, correct?</s>BERLIN: But there's no reason. Look, this is our ninth trip. We got in successfully five times. Five times, Israel did not stop us. We have no obligation to tell Israel that we're coming. We're going straight from international waters into the waters of Gaza. We are delivering supplies that Israel refuses to have the people of Palestine, the people of Gaza to have, cement, olive trees, paper, crayons for the children. That was what was on our boats. And Israel had no right to stop us in international water and murder us.</s>GRIFFIN: Let me ask you a question, Ms. Berlin -- paper, crayons, olive trees. I just had an expert on a congressman, Mike Pence, from Indiana, who is an expert on this issue as well. He said, look it, there is no humanitarian crisis in Gaza. People are eating in Gaza. There is medical aid. You are talking about paper, crayons and olive trees, and -- and placing basically your volunteers in a potential situation where they could be hurt or even killed, as we now learned.</s>BERLIN: Well, I don't know what --</s>GRIFFIN: What is the real aim here? Is it to -- is it to actually help and try to solve the situation in this Gaza Strip, or is it just to raise awareness of your issues?</s>BERLIN: I -- I understand the question. Let me finish this.</s>GRIFFIN: Mm-hmm.</s>BERLIN: First of all, Israel has a right to protect itself, but so does the Palestinians. There have been 30 Israelis killed since the year 2000 by rocket fire. No civilian should be killed. In that same amount of time, Israel has killed 3,000 people in Gaza. That's a 100-to-1 ratio. So, why don't you ask whether the Palestinians have the right to exist, whether the Palestinians have a right to protect themselves? Number two, I don't know where this congressman is getting his information, probably from some Zionist source. But if you want to look at U.N. reports, if you want to look at Amnesty International, every single one of them say that the people of Gaza are barely, barely getting subsistence-level food and clothing. Ours was not about food and clothing. Ours was about taking in construction supplies, so they could help rebuild their homes that were destroyed in Operation Lead. Israel is terrified of us.</s>GRIFFIN: Let me -- let me --</s>BERLIN: They met us with violence because they want us to stop.</s>GRIFFIN: Yes. Palestinian spokesman Ghaith Omari saying that the aid flotilla is not a good idea, that the people behind it are opportunists. You're that opportunist, he says.</s>BERLIN: And who is that? Is that a member of the Fatah? It's little bit like saying that the Republicans think that the Democrats are opportunists. We are a civilian initiative. If governments had the courage to stand up and do what they were supposed to do, and make Israel open up this blockage, you -- there would be no need for us. We would all go home. I teach</s>GRIFFIN: And you will continue to send volunteers who are willing, apparently, to die to do this?</s>BERLIN: There is no need for the volunteers to die. There was no need. The -- Michael Oren, who is the ambassador to the United States, admitted today that there wasn't any way they were going to be able to non-violently get on the largest Turkish boat. But I want to make something very clear. Every single boat was attacked, not just the Marmara, every boat. The Greek captain on the European Campaign to End the Siege boat was shot. Israel's doing this deliberately. Shoot the captains, shoot the volunteers, and --</s>GRIFFIN: OK. We have to go now. There obviously is going to be investigations, both by the Israelis and by, apparently, an international group looking into this, and will determine what exactly did happen. But, Greta Berlin with Free Gaza, always appreciate your feisty comments and your -- certainly your passion for this cause. And thanks for joining us. Well, you're looking at a live feed of the oil leak, as BP tries to cap it. How do they -- we know that they're really doing all they can to fix this? And should President Obama not only take over the cleanup, but take over the company? Robert Reich thinks so, and he lists five reasons. The former labor secretary is ahead. And more on the fallout over a flotilla of aid to Gaza. Warnings from Israel to Turkey are sparking outrage. A live report from Ivan Watson -- he's is Istanbul. That's next.