Senator Barbara Boxer (D-California) appeared on CSPAN’s Newsmakers this Sunday to talk about the Kerry-Boxer climate bill. The highlight of the interview was when Boxer said that recent behavioral changes led to a drop in U.S. greenhouse gas emissions. She must have been referring to foreclosures and layoffs, because the ailing economy is the only reason that emissions have fallen.

Boxer inadvertently made a great point: Greenhouse gas emissions are causally correlated with economic growth. This is why her cap-and-tax energy-rationing bill is bad news for the American economy.

Rumors surfaced last week that President Barack Obama now considers financial sector reform to be his administration’s #2 priority after healthcare. Previously, climate change was thought to be the next big-ticket item on the President’s agenda.

The tea-leaves seem to indicate that this rumor is true.

For starters, Senator Chris Dodd (D-Connecticut) decided to stay on as Chairman of the Senate Banking, Housing and Urban Affairs Committee, rather than accept the gavel on the Health, Education, Labor, and Pensions Committee (a post vacated by the passing of Ted Kennedy).

The only plausible explanation for Dodd’s decision to remain the chairman of the Banking Committee, which has jurisdiction over financial sector reform, is an expectation by Dodd that Obama will push for increased regulation of Wall Street in the short term. Dodd faces a tough re-election fight in 2010, and taking on Wall Street would put him in a favorable spotlight for the foreseeable future.

And today in New York, President Obama gave a speech on the need for a new regulatory regime to govern Wall Street, thereby lending further credence to the rumor that climate change has dropped as a priority.

Meanwhile, Senator Barbara Boxer (D-California), the chairman of the Environment and Public Works Committee (which has primary jurisdiction over climate change legislation) last week again delayed the introduction of global warming legislation, and Senator Dick Durbin (D-Illinois), the second ranking Democrat in the Senate, told reporters that cap-and-trade might have to wait until 2010.