[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.

                          ____________________