[Congressional Record Volume 149, Number 29 (Monday, February 24, 2003)]
[Senate]
[Pages S2554-S2573]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
Energy
I come to the floor today in another capacity, and that is as a
member of the Energy and Natural Resources Committee. I quickly bring
to the Senate recent disclosures about how a number of energy firms
have engaged in deceptive trading practices to drive up prices for
consumers in the western energy market. I believe strongly this recent
evidence requires the Federal Energy Regulatory Commission to take
additional strong and aggressive steps to keep energy markets from
continually being abused. I will update the Senate on these revelations
that have been uncovered in the past year.
Earlier this month, Jeffrey Richter, the former head of Enron's
Short-Term California energy trading desk, pled guilty to conspiracy to
commit fraud as part of Enron's well known schemes to manipulate
western energy markets. Richter's plea follows that of head Enron
trader Tim Belden in the fall of 2002. Belden admitted that he schemed
to defraud California during the Western energy crisis and also plead
guilty to conspiracy to commit wire fraud.
The Enron plea came on the heels of FERC's release of transcripts
from Reliant Energy that reveal how their traders intentionally
withheld power from the California market in an attempt to increase
prices. This is one of the most egregious examples of fraud and
manipulation that affected the western energy market in 2000 and 2001
and it is clear and convincing evidence of coordinate schemes to
defraud consumers.
Let me read just one part of the transcript to demonstrate the greed
behind the market abuse by Reliant and its traders.
On June 20, 2000 two Reliant employees had the following conversation
that reveals the company withheld power from the California market to
drive prices up. Let me read to you this phone call transcript.
Reliant Operations Manager 1: ``I don't necessarily foresee
those units being run the remainder of this week. In fact you
will probably see, in fact I know, tomorrow we have all the
units at Coolwater off.''
Reliant Plant Operator 2: ``Really?''
Reliant Operations Manager 1: ``Potentially. Even number
four. More due to some market manipulation attempts on our
part. And so, on number four it probably wouldn't last long.
I would probably be back on the next day, if not the day
after that. Trying to uh . . .''
Reliant Plant Operator 2: ``Trying to shorten supply, uh?
That way the price on demand goes up.''
Reliant Operations Manager 1: ``Well, we'll see.''
Reliant Plant Operator 2: ``I can understand. That's
cool.''
Reliant Operations Manager 1: ``We've got some term
positions that, you know, that would benefit.''
Six months after this incident, as the Senate Energy Committee was
attempting to get to the bottom of why energy prices were soaring in
the west, the President and CEO of Reliant testified before Congress
that the State of California ``has focused on an inaccurate perception
of market manipulation.''
Reliant's President and CEO went on to say:
We are proud of our contributions to keep generation
running to try to meet the demand for power in California.
Reliant Energy's plant and technical staffs have worked hard
to maximize the performance of our generation.
These transcripts prove otherwise and reveal the truth about market
manipulation in the energy sector.
If you think that is a lot of money, remember that the cost of energy
for California went from $8 billion 1 year to $28 billion the next
year. So the fraud and the manipulation was huge during that period of
time.
Despite this clear and convincing evidence of fraud, on January 31 of
this year, the Federal Energy Regulatory Commission chose to give
Reliant a slap on the wrist for this behavior. The company paid only
$13.8 million to sweep this criminal behavior under the rug and settle
with FERC.
Let me turn to some other recent examples that demonstrate how other
energy companies manipulated the western energy market as Reliant did.
On December 11 FERC finally released audio tapes that show how traders
at Williams conspired with AES Energy plant operators to keep power
offline and drive prices up.
The tapes depict how on April 27, 2000, Williams outage coordinator
Rhonda Morgan encouraged an AES operator at the company's Alamitos
plant to extend a plant outage because the California grid operator was
paying ``a premium'' for power at the time. The Williams employee
stated:
That's one reason it wouldn't hurt Williams' feelings if
the outage ran long.
[[Page S2568]]
Later that day, Eric Pendergraft, a high-ranking AES employee called
to confirm with Ms. Morgan that Williams wanted the plant to stay
offline by saying:
You guys were saying that it might not be such a bad thing
if it took us a little while longer to do our work? I don't
want to do something underhanded, Ms. Morgan responded, but
if there is work you can continue to do . . .''
At this point Mr. Pendergraft interrupted to cut off their suspicious
conversation, saying:
I understand. You don't have to talk anymore.
Clearly, this is evidence of a calculated intent to withhold power to
raise prices. I find it unconscionable.
Let's turn to some other examples.
On January 27, 2003, Michelle Marie Valencia, a 32-year-old former
senior energy trader for Dynegy was arrested on charges that she
reported fictitious natural gas transactions to an industry
publication.
On December 5, 2002, Todd Geiger, a former vice president on the
Canadian natural gas trading desk for El Paso Merchant Energy, was
charged with wire fraud and filing a false report after allegedly
telling a trade publication about the prices for 48 natural gas trades
that he never made in an effort to boost prices and company profit.
These indictments are just the latest examples of how energy firms
reported inaccurate prices to trade publications to drive energy prices
higher.
Industry publications claimed they could not be fooled by false
prices because deviant prices are rejected, but this claim was
predicated on the fact that everyone was reporting honestly--which we
now know they weren't doing.
CMS Energy, Williams, American Electric Power Company, and Dynegy
have each acknowledged that its employees gave inaccurate price data to
industry participants. On December 19 Dynegy agreed to pay a $5 million
fine for its actions.
In September an Administrative Law Judge at FERC issued a landmark
ruling concluding that El Paso Corporation withheld natural gas from
California and recommended penalty proceedings against the company.
Since the El Paso Pipeline carries most of the natural gas to Southern
California, this ruling has tremendous implications. The FERC
Commissioners are expected to take up this case for a final judgment
soon.
This is one of the things I tried to see the President about, but he
wouldn't see me, because it became very clear during this period of
time that natural gas going into San Juan, NM, was trading at about $5
to $6 a decatherm, whereas natural gas going just a short distance away
into southern California was trading at $60 a decatherm, and natural
gas forms the basis for the price of electricity. I had hoped if I
could give this information to the President of the United States at
that time that he might look into it and we might have prevented some
of what happened in the western energy markets. Unfortunately--and I
wrote four letters--he refused to see me on this subject.
This past summer, California State Senate investigators uncovered how
Perot Systems--a company which set up the computer system for
California's electricity market--provided its energy clients with a
detailed blueprint of how to exploit holes in the state's bidding
system to drive prices up.
These have been the latest revelations in a series of energy
disclosure bombshells that began on Monday, May 6, when the Federal
Energy Regulatory Commission posted a series of documents on their
website that revealed Enron manipulated the western energy market by
engaging in a number of suspect trading strategies.
These memos revealed for the first time how Enron used schemes called
``Death Star,'' ``Get Shorty,'' ``Fat Boy,'' and ``Ricochet'' to fleece
families and businesses in the West.
By using Death Star, for example, Enron would ``get paid for moving
energy to relieve congestion without actually moving energy or
relieving any congestion.'' That is according to their own internal
memo.
Just on its face, that is fraud. We are going to move energy without
moving energy--fraud.
In another strategy detailed in these memos, Enron would ``create the
appearance of congestion through the deliberate overstatement of
loads'' to drive prices up.
Create ``the appearance of congestion through the deliberate
overstatement of loads''--fraud.
The above-mentioned strategy reveals an intentional and coordinated
attempt to manipulate the western energy market for profit.
This is an important piece of the puzzle, and some former Enron
traders helped fill in the blanks.
CBS news reported in May that former Enron traders admitted that the
energy company was directly responsible for rolling blackouts in
California. Yet, interestingly enough, no one has followed up on this
report.
Anybody who has ever been through a rolling blackout knows what it is
like. Everything goes off and you cannot predict where it goes off
next. Street lights, hospitals--literally everything goes off.
According to CBS news, the traders said Enron's former President,
Jeff Skilling, pushed them to trade aggressively in California and told
them: If you can't do that, then you need to find a job at another
company or go trade pork bellies.
The CBS article mentions that Enron traders played a disturbing role
in blackouts that hit California. The report mentioned specific
manipulative behavior by Enron on June 14 and 15 in the summer of 2000
when traders said they intentionally clogged Path 26. That is a key
transmission path connecting northern and southern California. Here is
what one trader said about that event:
What we did was overbook the line we had the rights on
during the shortage or in a heat wave. We did this in June of
2000 when the Bay Area was going through a heat wave and the
ISO couldn't send power to the north. The ISO has to pay
Enron to free up the line in order to send power to San
Francisco to keep the lights on. But by the time they agreed
to pay us rolling blackouts had already hit California and
the price for electricity went through the roof.
California lost billions. Yet, according to the traders, Enron made
millions of dollars by employing this strategy alone.
On top of all of this, traders disclosed that Enron's manipulative
trading strategy helped force California to sign expensive long-term
contracts. It is no surprise that Enron and others were able to profit
so handsomely during the crisis.
Financial statements show that revenue and income surged for energy
trading companies in 2000 and 2001. Many firms such as Duke, Dynegy,
Enron, Mirant, Reliant, and Williams greatly increased their revenues
by taking advantage--taking advantage--of the California market.
And the evidence suggests that other companies were--and may continue
to be--engaging in these manipulative strategies and that the Enron
memos may well be the tip of the iceberg. One of the Enron memos said:
Enron may have been the first to use this strategy, others have picked
up on it, too.
Dynegy, Duke Energy, El Paso, Reliant Resources, CMS Energy, and
Williams all admitted engaging in false ``round-trip'' or ``wash''
trades.
What is a ``round-trip'' or ``wash'' trade, one might ask? ``Round-
trip'' trades occur when one firm sells energy to another and then the
second firm simultaneously sells the same amount of energy back to the
first company at exactly the same price. No commodity ever changes
hands. But when done on an exchange, these transactions send a price
signal to the market and they artificially boost revenue for the
company. Fraud again.
How widespread are ``round-trip'' trades? The Congressional Research
Service looked at trading patterns in the energy sector over the last
few years. This is what they reported:
This pattern of trading suggests a market environment in
which a significant volume of fictitious trading could have
taken place. Yet since most of the trading is unregulated by
the Government, we have only a slim idea of the illusion
being perpetrated in the energy sector.
Consider the following recent confessions from energy firms about
``round-trip'' trades:
Reliant admitted 10 percent of its trading revenues came
from ``round-trip'' trades. The announcement forced the
company's president and head of wholesale trading to both
step down.
DMS Energy announced 80 percent of its trade in 2001 were ``round-
trip'' trades.
[[Page S2569]]
That means 80 percent of all of their trades that year were bogus
trades where no commodity changed hands, and yet the balance sheets
reflect added revenue. If that isn't fraudulent, I do not know what is.
Remember, these trades are sham deals where nothing was exchanged.
Duke Energy disclosed that $1.1 billion worth of trades were ``round-
trip'' since 1999. Roughly two-thirds of these were done on the
InterContinental Exchange; that is, the online, nonregulated,
nonaudited, nonoversight for manipulation and fraud entity run by banks
in this country. That means thousands of subscribers would see false
pricing.
A lawyer for J.P. Morgan Chase admitted the bank engineered a series
of ``round-trip'' trades with Enron.
Dynegy and Williams have also admitted to ``round-trip'' trades.
Although these trades mostly occurred with electricity, there is
evidence that suggests that ``round-trip'' trades were made in natural
gas and even broad band.
By exchanging the same amount of commodity at the same price, I
believe these companies have not engaged in meaningful transactions but
deceptive practices to fool investors and drive up energy prices for
consumers. It is, therefore, imperative that the Department of Justice,
the Federal Energy Regulatory Commission, the Securities and Exchange
Commission, the Commodities Futures Trading Commission, and every other
oversight agency within this Federal Government conduct an aggressive
and vigorous investigation into all of the energy companies that
participated in these markets.
Beyond that, I believe Congress must reexamine what tools the
Government needs to better keep watch over these volatile markets that
are, frankly, little understood.
In the absence of vigilant Government oversight of the energy sector,
firms have the incentive to create the appearance of a mature, liquid,
and well-functioning market. But it is unclear, and I think improbable,
that such a market actually exists.
The ``round-trip'' trades and the Enron memos raise questions about
illusions in the energy market. To this end, I believe it is critical
for the Senate to act soon on the legislation I offered last April to
regulate online energy trading.
This week, I plan to reintroduce this legislation with Senators
Fitzgerald, Lugar, Harkin, Cantwell, Wyden, and Leahy, to subject
electronic exchanges like Enron On-Line to the same oversight,
reporting, and capital requirements as other commodity exchanges such
as the Chicago Mercantile Exchange, the New York Mercantile Exchange,
and the Chicago Board of Trade.
This legislation will be called the Energy Market Oversight Act.
Without this type of legislation, there is insufficient authority to
investigate and prevent fraud and price manipulation and, also, the
parties making the trade are not required to keep any records, nor are
the trades transparent. In other words, they are secret trades with no
audit trails, no oversight for fraud and manipulation. They cannot
exist over a regular exchange like that, but the Internet, the online
trading community is exempt from this oversight. It is a huge loophole,
and it has cost my State billions.
I strongly believe that in order to restore confidence in the
economy, we must bolster the authority of the Securities and Exchange
Commission, the Federal Energy Regulatory Commission, and the Commodity
Futures Trading Commission, and other regulatory agencies.
The marketplace must be fair and transparent, and regulatory bodies
such as FERC must show they will act in the public interest and release
to the public all information on fraud and manipulation. This includes
removing the ``protective order'' FERC has placed on evidence uncovered
by the State of California and other interested parties, information
the Commission has on wrongdoing in the energy sector but hasn't
disclosed. With something as broadly based as energy, as important to
people as energy, it is unconscionable to have all this information
protected in a lockbox. It must change.
I strongly believe families and businesses that suffered during the
western energy crisis have a right to know the extent of the fraud and
manipulation that was wrought upon them. So I intend to help ensure
that FERC fulfills its public duty so this abuse cannot happen again.
Unfortunately, at this time, none of us can give this guarantee to the
people of America. And that must change.
Mr. President, I yield the floor.
The PRESIDING OFFICER (Mr. Sununu). The Senator from Arizona.
Mr. KYL. Mr. President, I will speak about the nomination of Miguel
Estrada to be a judge for the District of Columbia Circuit Court of
Appeals.
That is, of course, the pending business before the Senate, and it is
the business which we will complete before we can move on to other
matters, such as the adoption of a budget, and the consideration of the
President's economic growth and jobs creation package. But I do not
think the President is going to back down on his nomination. Yet I
heard a member of the other side of the aisle yesterday, on television,
say as far as he was concerned, that nomination would never come up for
a vote; that is to say, at least until he ``answered'' the questions of
the Members of the other side.
I would like to set the record straight. Through an entire day of
hearings, and some 30 questions that were asked of him, Miguel Estrada
answered the questions posed. There has been an opportunity to follow
up with written questions. If Members have not availed themselves of
that opportunity, then that is their problem, not his.
Miguel Estrada has answered all of the questions put before him. He
is one of the most competent, qualified, brilliant lawyers the
President could have nominated for this position. And really nobody
disputes that. So the business about not answering questions is really
a smokescreen. It is a smokescreen for opposition to his candidacy
based upon the fact that President Bush nominated him and President
Bush is a conservative President.
President Bush, I suspect, is more representative of the mainstream
of the thinking in this country than certain people on the fringe of
either the Democratic party or the Republican party. So I do not think
one can simply say because President Bush has nominated somebody that
they are extremist or rightwing or that they are ideologves. In fact,
the people who have opposed Judge Estrada's nomination have confirmed
as much by saying they simply do not know enough about him. So I am a
little tired of those who say, on the one hand, we do not know enough
about him but, on the other hand, he is some kind of an ideologve. The
fact is, he isn't. They do not have anything to suggest he is. It seems
to me in the great American idiom, it is time to put up or shut up.
Now, we are not going to shut the Democratic side up. If they want to
keep talking about Miguel Estrada, they can talk, as far as we are
concerned, as long as they want to. But they should be addressing his
nomination instead of speaking about other things or simply not being
here on the Senate floor debating his confirmation. His confirmation is
the pending business. If Members have a concern about him, they ought
to bring it forth. If they have some evidence that he has done
something in his background that isn't right, then they ought to bring
it forth. If they have an objection to one of his opinions, then they
should bring that forth. None of this has happened or will happen
because, in fact, there is nothing there. That is why they are
regulated to saying: Well, we just don't know enough about him.
It is time for those who oppose Miguel Estrada to be honest about
their opposition, to come forth and talk to the American people about
it, and find out what the American people think about their opposition
to Miguel Estrada.
I put together just a few quotations of people around the country who
have commented on his nomination. I would like to just read a few of
them.
We are all aware of the fact the American Bar Association--whose
opinion used to be the ``Gold Standard'' for Democrat Members in the
Senate on judicial nominations--rated Miguel Estrada well qualified
unanimously. That is their highest rating. And they take into
consideration everything, from judicial temperament, to educational
background, to experience. Obviously, if someone were way outside the
mainstream or too political, the
[[Page S2570]]
American Bar Association would not have unanimously indicated their
approval of the candidate.
This is from Ruben Navarette, who wrote in the Dallas Morning News--
by the way, a very competent journalist who used to write for the
Arizona Republic, one of my hometown newspapers:
Miguel Estrada deserves a hearing, and Mr. Bush deserves to
have his nominees considered in a timely manner. The only
thing preventing that in the case of Mr. Estrada is Democrat
fear of the political damage they could sustain from such a
nomination.
So spoken by Ruben Navarette.
Ron Klain is a former counsel to Vice President Gore. He said this
just about a year ago:
I have no doubt that on the bench, Miguel will faithfully
apply the precedents of his court, and the Supreme Court,
without regard to his personal views or his political
perspectives. His belief in the rule of law, in a limited
judiciary, and in the separation of powers is too strong for
him to act otherwise.
That goes directly to this business that somehow or other Miguel
Estrada--though he has not written anything or said anything that would
lead to this conclusion--could not be trusted to apply the rule of law
as he understands it from the U.S. Supreme Court.
Here is a former counsel to Vice President Gore saying he knows
Miguel Estrada is beyond that, that Miguel Estrada is a person who
understands his role as a judge, his belief in the rule of law, and a
limited judiciary, and the separation of powers and, therefore, that he
would act in accordance with what we understand to be the correct role
of a judge in these circumstances.
There was a statement I thought particularly interesting from former
Solicitors General. Remember that Miguel Estrada was an Assistant
Solicitor General. This is the office in the Department of Justice that
actually represents the Government before the U.S. Supreme Court.
Miguel Estrada has argued 15 cases before the U.S. Supreme Court. In
a letter signed by colleagues from the Office of the Solicitor General
under Presidents Clinton and George H. W. Bush, dated September 19,
2002, I quote:
Miguel is a brilliant lawyer, with an extraordinary
capacity for articulate and incisive legal analysis and a
commanding knowledge of an appreciation for the law.
Moreover, he is a person whose conduct is characterized by
the utmost integrity and scrupulous fairness, as befits a
nominee to the federal bench. In addition, Miguel has a deep
and abiding love for his adopted country and the principles
for which it stands, and in particular for the rule of law.
Again, Democrats and Republicans alike affirm the fact that Miguel
Estrada is above partisan politics and appreciates his role as a judge,
applying the law of the precedents of the courts and of the Supreme
Court.
Seth Waxman was former Solicitor General during the Clinton
administration, a well-respected lawyer. This is what he wrote:
During the time Mr. Estrada and I worked together, he was a
model of professionalism and competence. In no way did I ever
discern that the recommendations Mr. Estrada made or the
analyses he propounded were colored in any way by his
personal views--or indeed that they reflected any
consideration other than the long-term interests of the
United States.
It is astounding to me that our friends on the other side of the
aisle, despite the recommendations of high level Clinton administration
lawyers affirming the professionalism and honesty and credentials of
Miguel Estrada, would still contend that they don't have enough
information about him. I suggest to my colleagues that they consult
some of their friends in the former Clinton administration, former
Solicitors General, and ask them about Miguel Estrada. If they are
saying they don't know enough about him, there are some very highly
qualified people to whom they could speak. I doubt there is anybody
they could speak to who knows Miguel Estrada well that wouldn't confirm
his qualifications to be on the court.
Instead they are relegated to dark, suspicious comments such as,
``Well, maybe he believes things that we don't know about because he
just hasn't answered our questions thoroughly enough.'' I suggest they
talk to those who have worked with him on a day-in and day-out basis.
They will find that he is not only highly qualified but very fair.
Just perhaps one or two other comments. Then I will yield to my
friends.
Rick Davolina, LULAC national president, said:
We are confident that Mr. Estrada will fulfill the duties
of the United States Circuit Judge for the District of
Columbia Circuit with fairness, intelligence, and commitment
to the ideals of the United States.
I had a call from one of the local LULAC officials over the weekend
who confirmed LULAC's position and support of his nomination.
Elizabeth Lisboa-Farrow, chair of the U.S. Hispanic Chamber of
Commerce, said:
From his humble beginnings as an immigrant from Honduras
who achieved a stellar academic career . . . to his varied
and impressive achievements in the Justice Department and
private firms, Mr. Estrada has shown himself to be one of
superior talents and accomplishments.
From the Hispanic community, from newspapers around the country, from
former Clinton administration officials and others who know Miguel
Estrada well, there is no doubt in their mind that he is not only
qualified to serve but that he would do so applying the precedents of
his court and the U.S. Supreme Court.
Therefore, I again ask my colleagues again on the other side of the
aisle, if you have concerns about Miguel Estrada, bring them to the
floor. Let's talk about them. Let's debate them. But at the end of the
day, it is only fair to give Miguel Estrada a vote so that he can be
confirmed as a judge on the DC Circuit Court of Appeals.
The PRESIDING OFFICER. The Senator from Oklahoma.
Mr. NICKLES. Mr. President, I compliment my friend and colleague from
Arizona and wish to join him in urging our colleagues to vote in favor
of Miguel Estrada to be on the DC Circuit Court of Appeals. Senator Kyl
said it all and said it well. I compliment him. I compliment Senator
Hatch for his leadership.
I urge my colleagues to support Miguel Estrada. I did something I
haven't done in my many years in the Senate. I suggested to some of our
colleagues that because, in the last couple of years, we had had a hard
time moving forward circuit court nominees before the Senate, that we
individually take one or two of these nominees and more or less adopt
them, get to know them well and encourage their nomination.
We had good success. I thank my friend, the former chairman of the
Judiciary Committee. We had good success in moving through a lot of the
district court nominees. Senator Leahy was very accommodating with us.
We moved through four Oklahoma judges to serve on the district court.
It didn't take very long. A lot of district court nominees were
confirmed.
But on the appellate level, on the circuit court level, it wasn't the
same. In fact, I believe in the last 2 years, the first 2 years, or the
107th Congress, President Bush submitted 32 nominees to the circuit
court and only 17 were confirmed--53 percent. That compares to
President Clinton. In his first 2 years he got 87 percent; President
Bush, 96 percent; and President Reagan, 95 percent. This President Bush
in the 107th Congress only got 53 percent.
I suggested to our colleagues, let's take special attention,
individual Senators take special attention to some of the nominees and
then encourage that they be confirmed. The reason I would do that is
obviously home State Senators are going to encourage their particular
nominees for district court, but maybe when you talk about the circuit
court, since it applies to many States, many areas, it doesn't have
quite the same degree of support from an individual Senator.
It so happens on Miguel Estrada, Senator Pete Domenici and I both
decided that we would take particular interest in Miguel Estrada. By
that we got to know him. We had meetings with him. We had press
conferences on his behalf. We encouraged others to join in the effort
to confirm Miguel Estrada. We were not successful in the last 2 years.
He was eventually approved by the committee but not on the floor of the
Senate.
That is with great regret. Now we are before the Senate trying to
confirm Miguel Estrada. We haven't been able to get a vote. We have
been talking for a long time. Now people want to talk, I don't know how
long, but we will spend some time because this is an outstanding
nominee.
[[Page S2571]]
I got to know him. He is a truly a success story. He immigrated to
this country from Honduras at age 17. Then he graduated magna cum laude
and Phi Beta Kappa from Columbia. He also graduated magna cum laude
from Harvard Law School where he distinguished himself as editor of the
Harvard Law Review. What a remarkable accomplishment for somebody who
immigrated to this country at age 17 and could hardly speak English.
Since then he has argued 15 cases before the U.S. Supreme Court. He
won 10 of those cases. Find the number of attorneys in the United
States who have argued 15 cases before the Supreme Court. It is a
pretty elite group. Almost by definition he is an outstanding attorney
or he would not have argued 15 cases before the Supreme Court.
He was rated unanimously well qualified by the American
Bar Association, its highest possible rating. President Clinton's
Solicitor General, a Democrat, Seth Waxman, had this to say about
Miguel Estrada:
During the time Mr. Estrada and I worked together, he was a
model of professionalism and competence. In no way did I ever
discern that the recommendations Mr. Estrada made or the
[views] he propounded were colored in any way by his personal
views--or indeed that they reflected anything other than the
long-term interests of the United States.
That is from President Clinton's Solicitor General. Some people are
saying, we want to see his notes when he was giving advice or memos as
Assistant Solicitor General. That should not be done.
Ron Klain, former counsel to Vice President Gore, wrote to Senator
Leahy on January 16, 2002:
Miguel is a person of outstanding character, tremendous
intellect, and with a deep commitment to the faithful
application of precedent. Miguel will rule justly towards all
without showing favor towards any group or individual.
Is there any higher standard that we should hold our judges to than
that? This is from the counsel to former Vice President Gore, also a
Democrat.
Mr. Estrada has extensive appellate practice, and he is widely
regarded as one of the country's best appellate lawyers. He is
currently a partner in the prestigious Washington, DC, law firm of
Gibson, Dunn & Crutcher. He also clerked for Judge Kearse, President
Carter's well-respected appointee to the Second Circuit Court of
Appeals. In 1998 and 1999, he clerked for Supreme Court Justice Anthony
Kennedy. It goes without saying that somebody who clerks for a Supreme
Court Justice is an exceptionally talented individual. He served as
Assistant Solicitor General of the United States under both Presidents
Clinton and Bush. He held that position for 5 years.
This is an exceptionally well-qualified individual. He has performed
significant pro bono service, including representation of a death row
inmate before the Supreme Court, a case to which he dedicated
approximately 400 hours.
So I don't think anyone can dispute that he is well qualified, and he
is an outstanding success story. I find no legitimate reason whatsoever
to oppose his nomination. I am very concerned about colleagues trying
to say, ``Now, you are going to have to get 60 votes to confirm Miguel
Estrada as a Federal judge.'' I am concerned about that.
I have been in the Senate for 22 years. I have heard people talk
about filibustering judges, but it has never happened in my Senate
career. We have filed cloture a few times--maybe for procedural
reasons, or whatever; but most of the time, even when cloture was
filed, it was granted overwhelmingly, with 85 or 90 votes in most
cases. Those were not filibusters. The only successful filibuster goes
back to 1968. So that is the only filibuster of a judicial nominee that
has happened in the history of the United States. That was on Abe
Fortas' nomination. It was filibustered by Democrats and Republicans. I
am not saying it was right. I think it was probably wrong. But this
hasn't been done since 1968.
I think it has been implied that many people in the Democrat Party
are talking about filibustering several judges. So we are going to have
a new standard now--that confirmation of judges is not 50 or 51, but it
is going to be 60. We didn't do that with Judge Bork, Justice Thomas,
or Justice Rehnquist, or in previous nominations that were fairly
controversial.
I urge my colleagues to think about this. If they are going to march
down this road and say you need 60 votes to confirm Mr. Estrada and
others, that may be a serious mistake. One may look back on his or her
Senate career and say we made a mistake. Both sides can play that game.
I don't want this side to play that game, and I don't want the other
side to play that game. Two wrongs don't make a right. We should not
make the first bad mistake on Miguel Estrada.
Other people have said they want to have more information. They don't
know enough about this young man. Compare. What did we know about many
of the judges who have been confirmed? They don't commit themselves on
how they would rule on a future case. Well, I hope they don't. They
should not. He is not turning over his memoranda that he did as
Assistant Solicitor General. First, those are confidential attorney-
client memoranda, which were not requested by the seven previous
nominees who worked in the Solicitor General's Office. We didn't
request them previously, and we should not today. Every former
Solicitor General, including Democrats Archibald Cox, Seth Waxman, Drew
Days, and Walter Dellinger, signed a letter to the Judiciary Committee
stating their opposition to the production of these documents, saying,
``By doing that, they would have a debilitating effect on the ability
of the Department of Justice to represent the United States before the
Supreme Court.''
Heaven forbid, if you have somebody working for a client saying, I
cannot give a memo because it might not be politically correct, or it
might not help me if I wish to be confirmed before the Senate in the
future, that is a terrible idea. Seth Waxman, a Democrat Solicitor
General under President Clinton, already said he represented the
interests of the United States. That may not have coincided with his
interest. It was in the interest of his client on whose behalf he was
advocating.
Also, it so happens--I believe Mr. Estrada has said he would be
willing to come forward with those, but the Justice Department rightly
says that would be a very negative precedent to set, and they are
rightfully saying they should be withheld, as all the former living
Solicitors General have said. They are correct.
Again, we didn't request these memoranda from the seven other
nominees who worked as Assistant Solicitors General. We should not do
it in this case.
Somebody said: What about Judge Paez and Judge Berzon? They were both
on the Ninth Circuit Court of Appeals, the most liberal circuit court
in the country. Yes, there was a cloture vote on both of them. I will
note that the cloture vote on both of them was--first, Marsha Berzon's
was 86 to 13. Cloture on Richard Paez was 85 to 14. So there wasn't a
filibuster on those two judges. We had a vote. I voted against them. I
think I made a good vote. They were confirmed.
We should vote on Miguel Estrada, and if people don't wish to confirm
him, they can vote no. The fact is, they know he would be confirmed, so
they are trying to deny him a vote. I urge my colleagues to step back a
little bit and ask what would this be doing to the Senate? The
Constitution gives the right to the Senate in the confirmation to give
advice and consent. That implies a vote. We should vote on Miguel
Estrada and we should confirm Miguel Estrada. I have every confidence,
having known him probably better than almost any circuit court nominee
in my 22 years, that he will make an outstanding circuit court judge,
one that we will be proud to have confirmed, one that the people who
are obstructing his confirmation will regret. I think they will soon
find out that he is an outstanding nominee and he will make an
outstanding judge.
I urge my colleagues who have maybe participated in dragging this
thing on--and we have been on it for a couple weeks--after talking to
Majority Leader Frist, I think we will be on it for a long time. Mr.
Estrada deserves a vote. He deserves our vote of confidence, and he
deserves to be confirmed by the Senate.
I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
[[Page S2572]]
Mr. NICKLES. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
conference agreement on h.j. res. 2
Mr. NICKLES. Mr. President, I submit for the Record a table which
summarizes the conference agreement on H.J. Res. 2, the fiscal year
2003 omnibus appropriations resolution. This table was prepared by my
staff based upon the estimates of the Congressional Budget Office.
I congratulate our majority leader and the chairman of the
Appropriations Committee for working to provide no more in total
appropriations for fiscal year 2003 than was requested by the
President. The conference agreement on H.J. Res. 2 contains $397.855
billion in discretionary spending which, when added to amounts in the
Defense and military construction appropriations bills already enacted,
totals $763.184 billion in fiscal year 2003 discretionary spending.
These totals increased from the Senate-passed levels primarily to
accommodate additional defense spending requested by the President. The
totals also include a 0.65 percent across-the-board reduction,
amounting to $2.622 billion, from most accounts in the 11 appropriation
bills included in the conference agreement.
Compared to fiscal year 2002, total discretionary spending after
enactment of H.J. Res. 2 will grow by 3.9 percent. Defense
discretionary spending will grow by 8.7 percent, and domestic
discretionary spending will decline by 0.7 percent.
Compared to fiscal year 2002 less spending for one-time nonrecurring
projects, total discretionary spending after enactment of H.J. Res. 2
will grow by 6.2 percent, defense discretionary spending will grow by
9.1 percent, and domestic discretionary spending will grow by 3.4
percent.
The conference agreement includes $25.385 billion in advance
appropriations, an increase of $2.227 billion over the level of advance
appropriations provide in fiscal year 2002 appropriations bills.
The conference agreement on H.J. Res. 2 also includes several
increases in mandatory spending programs. The increased spending, which
totals $4.257 billion in 2003 and $54.792 billion from 2003 to 2013
includes changes in agriculture payments for drought, payments to
physicians and rural hospitals, and TANF payments to States.
Mr. President, I ask for unanimous consent that a table displaying
the Budget Committee scoring of the conference agreement on H.J. Res. 2
and enacted appropriations, with a comparison to 2002, be printed in
the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
CBO ESTIMATES OF THE CONFERENCE APPROPRIATIONS BILLS FOR FY 2003
COMPARED TO FY 2002
[Budget authority, in billions of dollars]
------------------------------------------------------------------------
Percent
Senate increase
Subcommittees 2002 \1\ appropriations or
bills \2\ decrease
------------------------------------------------------------------------
Divisions A-K and Defense and
Military Construction Bills:
Agriculture....................... 17,171 17,995 4.8
CJS............................... 42,995 41,387 -3.7
Defense......................... 0.560 0.574 2.5
Nondefense...................... 42.435 40.813 -3.8
Defense........................... 334.113 354.830 6.2
DC................................ 0.607 0.512 -15.7
Energy and Water.................. 25.334 26.164 3.3
Defense......................... 15.164 15.898 4.8
Nondefense...................... 10.170 10.266 0.9
Foreign Ops....................... 16.433 16.300 -0.8
Interior.......................... 19.135 19.057 -0.4
Labor, HHS........................ 127.659 133.399 4.5
Legislative....................... 3.254 3.360 3.3
Mil Con........................... 10.604 10.499 -1.0
Transportation \3\................ 23.095 21.200 -8.2
Defense......................... 0.440 0.340 -22.7
Nondefense...................... 22.655 20.860 -7.9
Treasury, Postal.................. 18.515 18.326 -1.0
VA, HUD........................... 95.758 90.350 -5.6
Defense......................... 0.153 0.144 -5.9
Nondefense...................... 95.605 90.206 -5.6
Deficiencies...................... -0.350 0.000 ........
Defense......................... -0.196 0.000 ........
Nondefense...................... -0.154 0.000 ........
Total, Divisions A-K.......... 734.323 753.379 2.6
Defense..................... 360.838 382.285 5.9
Nondefense.................. 373.485 371.094 -0.6
Division: Classified Defense 0.000 10.000 ........
Programs...........................
Division N:
Election Reform--Title I.......... 0.000 1.500 ........
Wildland Fire Management--Title 0.000 0.825 ........
III..............................
Fisheries Disasters--Title V...... 0.000 0.100 ........
0.65 percent across the board 0.000 -2.622 ........
rescission on accounts (with
exceptions) in 11 bills--Title V.
Subtotal...................... 0.000 -0.197 ........
Division P: U.S.-China Commission... 0.000 0.002 ........
Total, Discretionary................ 734.323 763.184 3.9
Defense........................... 360.838 392.175 8.7
Nondefense........................ 373.485 371.009 -0.7
One-time, non-recurring projects \4\ 15.946 0.000 ........
Defense........................... 1.338 0.000 ........
Nondefense........................ 14.608 0.000 ........
Total, Discretionary less one-time.. 718.377 763.184 6.2
Defense........................... 359.500 392.175 9.1
Nondefense........................ 358.877 371.009 3.4
Total, without enacted Defense and ........ 397.855 ........
Mil Con............................
Defense........................... ........ 26.846 ........
Nondefense........................ ........ 371.009 ........
Memo:
Mandatory Items in Division N:....
Title II--Agriculture Drought ........ 3.084 ........
Relief, as amended.............
Title IV--Medicare Physicians..... ........ 0.800 ........
Title IV--Rural Hospitals....... ........ 0.250 ........
Title IV--Welfare Payments to ........ 0.098 ........
States.........................
Title IV--Ql-1 Program.......... ........ 0.025 ........
Title VII--Bonneville Power ........ 0.000 ........
Administration.................
Total....................... ........ 4.257 ........
Total, with Mandatories............. ........ 767.441 ........
Total, without enacted Defense and ........ 402.112 ........
Mil Con............................
------------------------------------------------------------------------
\1\ The 2002 figures include the levels enacted in the FY 2002
appropriations bills, as well as the $24.2 billion in BA in P.L. 107-
206 (the Emergency Supplemental Appropriations and Rescissions, 2002),
as estimated by CBO.
\2\ This represents Divisions A through P of the Conference Report on
H.J. Resolution 2 (Making Further Continuing Appropriations for the
Fiscal Year 2003, and for Other Purposes), as well as the FY 2003
Defense (P.L. 107-248) and Military Construction (P.L. 107-249)
appropriations bills. These bills also include $25.385 billion in
advance appropriations, $2.227 billion more than the $23.158 billion
in advances for the FY 2002 appropriation bills.
\3\ Includes mass transit budget authority of $1.445 billion.
\4\ The $15.946 billion in one-time, nonrecurring projects and
activities were identified in Attachment C of OMB Bulletin 02-06,
Supplement No. 1, dated October 4, 2002.
Source: Congressional Budget Office; Senate Budget Committee Republican
Staff.
H.J. RES. 2: 2003 OMNIBUS APPROPRIATIONS BILL, CONFERENCE
[Fiscal year 2003, in millions of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2004-13
--------------------------------------------------------------------------------------------------------------------------------------------------------
Mandatory:
Division N:
Title 2--Agricultural assistance:
BA................................... 3,084 60 47 54 (10) (213) (375) (498) (603) (703) (849) (3,090)
O.................................... 3,137 535 184 153 62 (168) (344) (479) (599) (702) (848) (2,206)
Title 4--Medicaid:
Section 401:
TANF:
BA............................... 64 ....... ....... ....... ....... ....... ....... ....... ....... ....... ....... ........
O................................ 71 6 3 (7) ....... (6) (3) ....... ....... ....... ....... (7)
Transitional Medicaid:
BA............................... 34 85 9 3 ....... ....... (2) ....... ....... ....... ....... 95
O................................ 32 80 11 3 ....... ....... 1 ....... ....... ....... ....... 95
Total, section 401:
BA........................... 98 855 9 3 ....... ....... (2) ....... ....... ....... ....... 95
O............................ 103 86 14 (4) ....... (6) (2) ....... ....... ....... ....... 88
Section 402(a)--physicians' fee
schedule:
BA........................... 800 2,200 3,000 4,000 5,200 6,500 7,300 7,000 6,300 5,800 5,500 52,800
O............................ 800 2,200 3,000 4,000 5,200 6,500 7,300 7,000 6,300 5,800 5,500 52,800
Section 402(b)--Hospitals:
BA................................. 250 30 ....... ....... ....... ....... ....... ....... ....... ....... ....... 30
O.................................. 250 30 ....... ....... ....... ....... ....... ....... ....... ....... ....... 30
Section 403--Ql-1 program:
BA................................. 25 ....... ....... ....... ....... ....... ....... ....... ....... ....... ....... ........
O.................................. 25 ....... ....... ....... ....... ....... ....... ....... ....... ....... ....... ........
Total, title 4:
BA........................... 1,173 2,315 3,009 4,003 5,200 6,500 7,298 7,000 6,300 5,800 5,500 52,925
O............................ 1,178 2,316 3,014 3,996 5,200 6,494 7,298 7,000 6,300 5,800 5,500 52,918
Title 7--Bonneville Power
Administration:
BA................................... ....... 300 300 100 ....... ....... ....... ....... ....... ....... ....... 700
O.................................... ....... 60 210 260 140 30 ....... ....... ....... ....... ....... 700
Total, H.J. Res. 2,
mandatory:
BA......................... 4,257 2,675 3,356 4,157 5,190 6,287 6,923 6,502 5,697 5,097 4,651 50,535
O.......................... 4,315 2,911 3,408 4,409 5,402 6,356 6,954 6,521 5,701 5,098 4,652 51,412
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page S2573]]
Mr. LEAHY. Mr. President, I will speak for a few minutes regarding
the debate on Mr. Estrada. The reason I say this, when I came on the
floor I heard a great deal of discussion about the Hispanic National
Bar Association. I heard from my friends on the other side of the aisle
the current president of the Hispanic National Bar Association has led
the support of this organization for Mr. Estrada's nomination, which is
so. However, it jogged my memory that this morning I received a letter
from 15 former presidents of the Hispanic National Bar Association.
These 15 take an entirely different position than the current
president: 15 well-respected former national leaders of this important
bar association. They date back to the founding of it in 1972.
They have written to the Senate to oppose this nomination. They wrote
to Senator Hatch and they wrote to Senator Frist, as well as to Senator
Daschle and myself. I am sure the speakers earlier this morning, when
they spoke of the importance of the position of the president of the
Hispanic National Bar Association, were probably not aware that but one
is in favor of Mr. Estrada and 15 were opposed. It is very weighty
opposition for 15 prior presidents of the Hispanic National Bar
Association, based on the criteria to evaluate judicial nominees that
this association has formally used since 1991, which has been the
practical standard for the past 30 years, to make this assessment.
In addition to the candidate's professional experience and
temperament, the criteria for endorsement includes the extent to which
a candidate has been involved, supportive of, and responsive to the
issues, needs, and concerns of Hispanic Americans and, secondly, the
candidate's demonstrated commitment to the concept of equal opportunity
and equal justice under the law.
In the view of the overwhelming majority of the living past
presidents of the Hispanic National Bar Association, Mr. Estrada's
record does not provide evidence that meets those criteria. But they
say his candidacy ``falls short in these respects.''
They conclude:
We believe that for many reasons including: his virtually
non-existent written record, his verbally expressed and
unrebutted extreme views, his lack of judicial or academic
teaching experience (against which his fairness, reasoning
skills and judicial philosophy could be properly tested), his
poor judicial temperament, his total lack of any connection
whatsoever to, or lack of demonstrated interest in the
Hispanic community, his refusals to answer even the most
basic questions about civil rights and constitutional law,
his less than candid responses to other straightforward
questions of Senate Judiciary Committee members, and because
of the Administration's refusal to provide the Judiciary
Committee the additional information and cooperation it needs
to address these concerns, the United States Senate cannot
and must not conclude that Mr. Estrada can be a fair and
impartial appellate court judge.
This is a significant letter because during the tenure of these past
presidents, the Hispanic National Bar Association has had a fair
nonpartisan record of following its criteria, and endorsing or not
endorsing or rejecting nominees, regardless of whether the nominee is
Republican or Democrat. They follow the same criteria for Republicans
and Democrats. The HNBA has been at the forefront of the effort to
increase diversity on the Federal bench and improve the public
confidence among Hispanics and others in the fairness of the Federal
courts. They have supported Republican nominees as well as Democratic
nominees. But these 15 individuals, who devoted a great deal of time in
their legal careers to advancing the careers of Hispanics in the legal
community, have felt compelled publicly to oppose the Estrada
nomination, although they publicly supported both Democrats and
Republicans before. This one they opposed.
I ask unanimous consent the letter that was sent to me, to Senator
Hatch, to Senator Frist, and to Senator Daschle be printed in the
Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
HNBA's Past Presidents' Statement, February 21, 2003
We the undersigned past presidents of the Hispanic National
Bar Association write in strong opposition to the nomination
of Miguel A. Estrada for a judgeship on the Court of Appeals
for the District of Columbia Circuit.
Since the HNBA's Establishment in 1972, promoting civil
rights and advocating for judicial appointments of qualified
Hispanic Americans throughout our nation have been our
fundamental concerns. Over the years, we have had a proven
and respected record of endorsing or not endorsing or
rejecting nominees on a non-partisan basis of both Republican
and Democratic presidents.
In addition to evaluating a candidate's professional
experience and judicial temperament, the HNBA's policies and
procedures governing judicial endorsements have required that
the following additional criteria be considered:
1. The extent to which a candidate has been involved in,
supportive of, and responsive to the issues, needs and
concerns of Hispanic Americans, and
2. The candidate's demonstrated commitment to the concept
of equal opportunity and equal justice under the law.
Based upon our review and understanding of the totality of
Mr. Estrada's record and life's experiences, we believe that
there are more than enough reasons to conclude that Mr.
Estrada's candidacy falls short in these respects. We believe
that for many reasons including: his virtually non-existent
written record, his verbally expressed and un-rebutted
extreme views, his lack of judicial or academic teaching
experience, (against which his fairness, reasoning skills and
judicial philosophy could be properly tested), his poor
judicial temperament, his total lack of any connection
whatsoever to, or lack of demonstrated interest in the
Hispanic community, has refusals to answer even the most
basic questions about civil rights and constitutional law,
his less than candid responses to other straightforward
questions of Senate Judiciary Committee members, and because
of the Administration's refusal to provide the Judiciary
Committee the additional information and cooperation it needs
to address these concerns, the United States Senate cannot
and must not conclude that Mr. Estrada can be a fair and
impartial appellate court judge.
Respectfully submitted,
Signed by 15 past HNBA presidents.
Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. LEAHY. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
____________________