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Will Schmidt Divest From Google to Become Commerce Secretary?

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Wed, Mar 30, 2011 at 12:20 pm

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Will Schmidt Divest From Google to Become Commerce Secretary?

The strong buzz in Washington, DC is that Google CEO Eric Schmidt is President Obama’s top choice for Commerce Secretary and an appointment is coming soon. The CEO who made billions collecting our personal information online and serving us up to advertisers, the guy who created online privacy problems, would head the federal agency responsible for developing and executing the administration’s online privacy policies.

Part of me wants to see Schmidt appointed because he would finally have to testify before Congress. Here’s a guy who presided over the largest wiretapping scandal in American history, when Google Street View cars took data presumably from tens of millions of wi-fi networks across the world, and he has not even had to testify before Congress. Now that’s a guy who is wired. Connected all the way to the Oval Office apparently. (Consumer Watchdog made a very funny video about what Schmidt’s faux testimony would look like.)

Apparently no one in the West Wing has been able to talk practically with the president, who really wants Schmidt. It’s hard to imagine how a guy who owns roughly $5.41 billion worth of Google stock could avoid a conflict of interest. There’s only one way: Schmidt will have to sell all his stock, and his part ownership of the company. You cannot place that much wealth in a blind trust when everyone knows where the wealth springs from. That’s a seeing-eye trust. The very type that exploded the career of one time Senate Majority Leader Bill Frist.

Then there’s Schmidt’s crazy mistress/girlfriend stuff that’s too rich for the GOP family values crowd in the Senate not to come after on the character/family values issue. Since this is business, not personal, so I’ll let the online tabloids talk:

Eric Schmidt’s ex-girlfriend sets her sights on Facebook;

Google’s CEO Demanded His Mistress Take Down Her Blog;

Is Google CEO’s Other Girlfriend Getting Indiscreet, Too?;

Google CEO Deters Mistress Tattle Tales; Getting Cozy with Google CEO’s Mistress And His Money;

The Google CEO and His Mistress: The Tell-All Blog;

How Google CEO’s Ex Girlfriend Keeps Tabs on Him;

Google CEO Has Money for ‘Dear Friend’ of His Sometime Girlfriend

There are strong policy reasons not to make America’s policy on commerce Google’s brand of business. Consumer Watchdog enumerated them in a letter to President Obama weeks ago, but we have not received a letter back, not even a Gmail.

In a nut shell, Google’s brand of business is to ignore ethical mores, social customs, and the rule of law — as a federal judge ruled last week to uphold copyright laws against Google’s digital assault on them in its Digi-Book-Mart deal. The judge sided with Consumer Watchdog and other consumer groups when claiming the deal would give Google a “de facto monopoly.”

Obama has shown some remarkably bad judgment at pivotal moments of his presidency. Right before the spill in the Gulf of Mexico, he agreed to include offshore drilling in his energy bill. Just after the tsunami struck Japan, his administration reiterated its support for nuclear energy. Now, on the verge of an online privacy revolution, Obama is about to appoint a CEO who is The Anti-Privacy to his chief privacy post. 90% of the public wants more online privacy. Hmmm, do you think Americans will be happy with Mr. Schmidt and the president in the end?

Part of me is looking forward to this nomination since, deal or no deal with Senate leaders on the confirmation, Schmidt will be a big, bright pinata for privacy advocates when he gets to take the oath at the confirmation hearings. I’m betting there are some senators who will ask the tough questions, and finally we’ll get some answers about Google’s scandals. Google stock might even suffer the consequences.

This could be one confirmation hearing where Mr. Schmidt, whose known for his verbal gaffes, could cost himself hundreds of millions of dollars with the wrong word choice. (Remember, “Google’s policy is get right up to the Creepy Line?”) If Google’s stock falls $50 or so from its $575 heights based on those hearings, Schmidt’s wealth, based on 9,372,741 shares of stock, goes down by about about a half billion dollars. Now that’s one expensive confirmation process!

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Jamie Court is President of Consumer Watchdog. His most recent book is The Progressive’s Guide To Raising Hell.

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This post was written by:

Jamie Court

- who has written 26 posts on Inside Google.

Jamie Court is the author of The Progressive's Guide to Raising Hell and the President of Consumer Watchdog, a nonpartisan, nonprofit organization dedicated to providing an effective voice for taxpayers and consumers in an era when special interests dominate public discourse, government and politics. Visit us on Facebook and Twitter.

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