Was unethical behavior by bankers a major factor in the economic crash?

To follow is an excerpt from the CQ Researcher report called "Financial Industry Overhaul" by Marcia Clemmitt on July 30, 2010

Some observers are convinced that financial markets are hotbeds of unethical conduct, but others point out that seeking profit is not only legal but is what the public demands that financial firms do.

Goldman Sachs is “a great vampire squid wrapped around the face of humanity … little better than a criminal enterprise that earns its billions by bilking the market, the government, and even its own clients in a bewildering variety of complex financial scams,” fumed financial reporter Matt Taibbi.[Footnote 14]

In 2006, Goldman sold $76.5 billion in mortgage-backed investments, of which about $59.1 billion — more than three-quarters — consisted of hundreds of home loans that either were made to people with very bad credit or had other serious problems, such as risky terms like a no down-payment requirement, Taibbi said. Then, “some Dutch teachers' union that a year before was buying ultra-safe U.S. Treasury bonds … runs into a Goldman salesman who offers them a different, ‘just as safe’ AAA-rated investment that, at the moment anyway, just happens to be earning a much higher return than Treasuries. Next thing you know, a bunch of teachers in Holland are betting their retirement nest eggs on a bunch of meth-addicted ‘homeowners’ in Texas and Arizona…. This isn't really commerce, but much more like organized crime … a gigantic fraud perpetrated on the economy that wouldn't have been possible without accomplices in the ratings agencies and regulators willing to turn a blind eye,” said Taibbi.[Footnote 15]

“It is unacceptable to continue allowing Wall Street to put their short-term gambles ahead of the long-term prosperity of Main Street America,” said Sen. Jeff Merkley, D-Ore., who sought to ban so-called “proprietary trading” — banks trading securities for their own profits rather than on behalf of customers — but secured only minor limitations on such trades. “We've seen how proprietary trading can cause conflicts of interest when firms bet against securities they help put together for their clients,” Merkeley said.[Footnote 16]

Sen. Carl Levin, D-Mich., who cosponsored Merkeley's proposal, labeled many bankers' primary motivation “extreme greed.”[Footnote 17]

In many cases, both sellers and buyers of the complex investments called “derivatives” are “cheaters,” charged Frank Partnoy, a professor of law and finance at the University of California, San Diego, and a former associate at the New York City-based financial services firm Morgan Stanley. Some derivatives allow people to avoid taxes by making their investment portfolios appear to have a different mix of risks and assets than they actually do, he said. In a so-called “equity swap,” a “bank that sells the swap makes money, and the purchaser … makes money because they effectively get to liquidate a portion of their stock position without paying tax. They both win,” but the public loses a legitimate part of the tax base, Partnoy said.[Footnote 18]

“Ethical rot” and “perverse incentives … caused the ongoing financial crisis,” said William K. Black, an associate professor of economics and law at the University of Missouri who was a federal bank regulator during the savings and loan meltdown of the late 1980s. For example, “executive compensation and the compensation systems used for appraisers, accountants and rating agencies were designed” to create a business climate in which “fraudulent and abusive lending and accounting practices drove good practices out of the marketplace.”[Footnote 19]

“I don't think those who went into finance are greedier or more deficient in moral scruples than others,” but the incentives in the way financial markets currently operate “led them to behave” as if they were, said Joseph E. Stiglitz, co-winner of the 2001 Nobel Prize for economics and a professor of economics at Columbia University. The idea that “you have to pay me more if I succeed in increasing profits” became “conventional wisdom,” leading bankers to neglect the fact that banks “are a means to an end” in the economy, “not an end in themselves.”[Footnote 20]

“A good financial system” manages risk, allocates capital and runs the economy's payment system “at low transaction costs,” said Stiglitz. “Our financial system created risk and mismanaged capital, all the while generating huge transaction costs” — financial firms' outsized profits compared to other industries. While bankers claim that products like derivatives created real value in the economy, “it is hard to find evidence of any real growth associated” with these “so-called innovations,” Stiglitz said.[Footnote 21]

“So deceptive were the systems of creative accounting” employed in pursuit of large returns that bankers “didn't even know their own balance sheets, and so they knew that they couldn't know that of any other bank,” Stiglitz said. No wonder then that lending between banks — which allows bankers quick access to cash they can then loan to businesses — froze up in a crisis of trust that helped topple the world's economy, he said.[Footnote 22]

Financial-industry executives mostly reject such charges.

Far from ignoring obligations to society, most bankers embrace their social purpose, said Goldman Sachs Chairman Lloyd Blankfein. “I know I could slit my wrists and people would cheer,” but accusers don't realize that the bank does “God's work,” Blankfein said. “We help companies to grow by helping them to raise capital…. This, in turn, allows people to have jobs that create more growth and more wealth. It's a virtuous cycle.”[Footnote 23]

Some bankers have exhibited a “failed moral compass” by “hiring people and promoting people based simply … on commercial productivity” rather than the “many other criteria that could be used,” acknowledged Brian Griffiths, vice chairman of Goldman Sachs International. Nevertheless, “my reading of [Scottish philosopher and economist] Adam Smith is that self-interested actions,” though “they may sometimes be selfish,” produce social good, he said. (Smith's 1776 treatise An Inquiry into the Nature and Causes of the Wealth of Nations theorizes that an “invisible hand” guides the free market to produce and price things correctly, despite seeming chaos.) “I think that the injunction of Jesus to love our neighbors as ourselves is a recognition of self-interest” as a positive social force, said Griffiths.[Footnote 24]

Banks do only what society asks of them, says Amy Sepinwall, an assistant professor of legal studies and business ethics at the University of Pennsylvania's Wharton School. “We live in a get-rich-quick culture, and we ask people [in the financial industry] on our behalf to make as much money as possible in as little time as possible, so in a way we're sort of licensing this.”

“Individuals prefer to spend rather than save, and, as a result, demand the kind of financial alchemy that can transform one's house into a virtual ATM or one's exceedingly modest savings into a fiscal cushion that can sustain a long, comfortable retirement,” Sepinwall said. Thus, the risk that crashed the system “is the inevitable price of our preferences for leisure over toil and consumption over savings.”[Footnote 25]

The Issues:
* Will the new law avert another crisis?
* Are tougher rules for financial firms needed?
* Was unethical behavior by bankers a major factor in the economic crash?
* Should big banks be broken up?

For more information see the CQ Researcher report on "America at War" [subscription required] or purchase the PDF

[14] Matt Taibbi, “Will Goldman Sachs Prove Greed is God?” The Guardian [UK], April 24, 2010.
[15] Matt Taibbi, “The Greatest Non-Apology of All Time,” The Smirking Chimp blog, June 19, 2009.
[16] “Merkley-Levin Amendment to Crack Down on High-Risk Proprietary Trading,” press release, Office of Sen. Jeff Merkley, May 10, 2010.
[17] Ibid.
[18] Joe Kolman, “The World According to Frank Partnoy,” DerivativesStrategy.com, October 1997.
[19]. William K. Black, “The Audacity of Dopes,” Huffington Post blog, May 28, 2010.
[20] Testimony before House Committee on Financial Services, Jan. 22, 2010.
[21] Ibid.
[22] Ibid.
[23] Quoted in John Arlidge, “I'm Doing ‘God's Work.’ Meet Mr. Goldman Sachs,” London Times online, Nov. 8, 2009.
[24] Regulation, Freedom and Human Welfare, St. Paul's Institute panel discussion, transcript, Oct. 20, 2009.
[25] Quoted in “‘A Race to the Bottom’: Assigning Responsibility for the Financial Crisis,” Knowledge at Wharton newsletter, Dec. 9, 2009, .

Kagan Pressed on Commerce Powers

By Kenneth Jost
Supreme Court Editor, CQ Press
      Senate Judiciary Committee Republicans latched on to one more issue last week [July 20] to use against Supreme Court nominee Elena Kagan: the Constitution’s Commerce Clause. But the issue puts Republicans in the contradictory position of begging Kagan, if confirmed, to be a judicial activist and limit the power of Congress to exercise one of the most important of the enumerated powers written into the Constitution 200 years ago.
      In the hearing and in written response to follow-up questions, Kagan correctly stated current Supreme Court case law regarding Congress’ power to regulate interstate and foreign commerce. “The Commerce Clause has been understood to give Congress wide authority in this area, that the general view has been that regulations affecting interstate commerce primarily are the prerogative of Congress and not of the courts, that courts ought to defer,” she told Arizona’s John Kyl on the last day of the hearing.
      As she explained in her written response, decisions by the Rehnquist Court in the 1990s limit Congress’ power to use the Commerce Clause to regulate non-economic activity that has no substantial effect on interstate commerce. And she noted that another Rehnquist Court decision limits Congress’ power to pass laws enforcing the Due Process and Equal Protection Clauses of the Fourteenth Amendment.
      Those qualifications were not enough to satisfy Alabama’s Jeff Sessions, the committee’s ranking Republican. As he wrote in an op-ed in USA Today on the eve of the committee’s vote, “Ms. Kagan was unable to identify any constitutional limits on the government's power to control people's economic decisions.”
      The question arises in the specific context of President Obama’s hard-fought victory in winning congressional approval of a landmark health insurance reform. No Republican voted for the final bill, and the ink was barely dry on the law when attorneys general in red states filed constitutional challenges.
      The challengers are claiming that the health insurance mandate, the linchpin of the plan, exceeds Congress’ power under the Commerce Clause. They also claim that the law improperly interferes with states’ rights under the Tenth Amendment. Most but not all legal scholars give the challenges little chance of succeeding.
      Historically, the Supreme Court indeed took a narrower view of Congress’ powers under the Commerce Clause. In the late 19th and early 20th centuries the court construed the word “commerce” narrowly to exclude manufacturing. On that basis, for example, the court struck down Congress’ first attempt to prohibit child labor. Later, during the New Deal, the court again relied on a restrictive definition of commerce to strike down President Franklin D. Roosevelt’s National Recovery Administration and his coal-industry rescue plan.
      The court’s decisions were out of touch with economic reality and public opinion. Even before FDR’s ill-conceived “court-packing” plan, one of the justices, Owen J. Roberts, began to have doubts about the out-of-date doctrine. Then in May 1937 he provided the famous “switch in time that saved nine” to uphold the National Labor Relations Act under a broader definition of Congress’ power to regulate interstate commerce.
      Ever since, the court has understood Congress’ Commerce Power over economic activities to be up to Congress, not the courts, to decide, just as Kagan said. Indeed, the court in 2005 upheld Congress’ power to go so far as to prohibit non-personal growing of marijuana for medicinal purposes because of the impact on the illegal market for marijuana. Granted three conservatives dissented, but significantly, Justice Antonin Scalia voted with the majority.
      The Roberts Court this year gave no indication of taking a narrower view of Congress’ powers. In United States v. Comstock the court upheld Congress’ power to authorize civil commitment of dangerous mentally ill sexual predators after their federal prison terms had expired. The case turned on the meaning of the Necessary and Proper Clause, not the Commerce Clause, but the 7-2 decision found no reason to limit Congress’ power to deal in practical terms with a practical problem. Significantly, Chief Justice John G. Roberts Jr. joined with the majority.
      The health care suit will take two years or more to reach the court. But, anticipating the Supreme Court showdown, Judiciary Committee Republicans tried to use Kagan’s confirmation hearing to establish grounds for requiring her to recuse herself from the eventual case. Kagan had already volunteered the standard assurance that she would recuse herself from any case in which she had participated or taken a significant role as solicitor general. So Republicans questioned her during the hearing and again in the post-hearing interrogatories about what role she had played in regard to the legislation. Kagan said she had given no formal opinion about its constitutionality and could recall attending only one meeting where the subject was mentioned.
      Sessions and other Republicans cited Kagan’s view of Congress’ Commerce Power as one of the reasons for voting against her almost in the same breath as they warned that she would be a “judicial activist” if confirmed. Judicial activism, of course, is in the eyes of the beholder, but Republicans might rightly be expected not to be so blatantly hypocritical in throwing the charge. Regardless, Republicans have a losing hand. By this week’s end, the Senate will have confirmed Kagan, and she will be on the bench when the court convenes in October.

Are the wars in Iraq and Afghanistan making U.S. enemies weaker?

To follow is an excerpt from the CQ Researcher report "America at War" by Peter Katel, July 23, 2010

From the very beginning of the post-Sept. 11 wartime period, U.S. officials were warning that the conflicts wouldn't end with the equivalent of the definitive enemy surrenders that halted World War II.

Instead, the key sign would be the elimination of terrorist sanctuaries, where Al Qaeda and like-minded organizations can plan, train and coordinate. Today, the key sanctuary is the Afghanistan-Pakistan border region. That zone is the “locus of the heartland of Al Qaeda,” Defense Undersecretary for Policy Flournoy told the House Armed Services Committee in May. [Footnote 30]

And Al Qaeda in some ways is more dangerous today, said Michael Leiter, director of the National Counterterrorism Center, a government agency established in 2004 that reports to the president. He said the organization showed its capabilities in the case of Najibullah Zazi, an Afghan immigrant to the United States, who pleaded guilty in February to terrorism charges centered on a plan to explode a bomb in the New York subway system.[Footnote 31] “There has been a diversification of the threat and a move towards simpler, smaller efforts to attack the United States,” Leiter said, “which don't have quite the same level of threat in terms of the damage it might cause, but in the multiplicity of the threats I think it is more challenging today.”[Footnote 32]

But with half its leaders killed, “Al Qaeda senior leadership in Pakistan is weaker today than it has been since 2001,” Leiter told a conference at the Aspen Institute think tank in Colorado. “Now, weaker doesn't mean harmless … It is still a meaningful and dangerous force.”[Footnote 33]

Opponents of the Afghan war say conditions in the jihadist heartland show the failure of the effort to destroy Al Qaeda in war, as opposed to more precisely targeted law-enforcement and military operations. “We ourselves, for domestic political reasons, make things worse and not better by turning these mass murderers into warriors,” says Andrews of Win Without War. “Framing this as a war and elevating them to warriors fighting for a cause, we strengthen them. We need to revisit whether this approach makes sense — the facts show very clearly that it doesn't.”

A smarter, more effective response to the Sept. 11 attacks would have been to “use tools that actually work — surgical operations where you go after these guys,” Andrews says. “That does not mean invading and having a massive military footprint in a country.”

But a senior U.S. security official with long experience both in Iraq and Afghanistan argues that the long military campaign has weakened the United States' enemies. “The risk of a 9/11-type event has clearly gone down,” the official says, speaking on condition he not be named. “They've not been able to pull off something like that. The pressure we've put on their networks, and the leadership targeting, is important.” To be sure, he acknowledges, much of that pressure and targeting is taking place in Pakistan, where U.S. troops are not waging war.

Nevertheless, he says, “What takes Afghanistan from an important national interest to a vital national interest is that, if we did not surge in Afghanistan, you would see the Pakistanis cutting a lot more deals” with jihadists. “The resources we are investing in Afghanistan have helped us make the case to them that we are doing our part.”

But other experts argue that the war — along with drone strikes on Al Qaeda targets in Pakistan — is hurting more than it's helping. “The presence and operations of the U.S. in the theater … because they are misperceived in terms of their nature and purpose, has continued to be a stimulus to radicalism including radicalism that takes the form of terrorism,” Paul Pillar, a former career CIA specialist in the region, said in June at a Washington conference held by the Center for a New American Security (CNAS).[Footnote 34]

The U.S. military deployment has also prompted non-radicals to join the fight against the Americans and their allies, said Pillar, now the graduate studies director of Georgetown University's Center for Peace and Security Studies in Washington “This has been reflected … in the continued taking up of arms by many Afghans who have no sympathy whatsoever for the extreme political and social views of the Taliban but see themselves as waging an anti-occupation struggle.”[Footnote 35]
The Issues:
* Can the United States meet the troop drawdown start date in Afghanistan?
* Should immediate negotiations with the Taliban be the top U.S. priority?
* Are the wars in Iraq and Afghanistan making U.S. enemies weaker?

For more information see the CQ Researcher report on "America at War" [subscription required] or purchase the PDF


[30] ”House Armed Services Committee Holds Hearing on Developments in Afghanistan,” CQ Congressional Transcripts, May 5, 2010.

[31] A.G. Sulzberger and William K. Rashbaum, “Guilty Plea Made in Plot to Bomb New York Subway,” The New York Times, Feb. 22, 2010.

[32] “Terror Threat From Abroad,” Aspen Institute, C-SPAN, June 30, 2010 (Web video).

[33] Ibid.

[34] “Beyond Afghanistan: America's Enduring Interests in Central and South Asia,” Center for a New American Security, June 10, 2010, transcript.

[35] Ibid.

Kagan Clears Committee on Partisan Vote

By Kenneth Jost
Supreme Court Editor, CQ Press
And Seth Shapiro
Editorial Intern, CQ Researcher

Supreme Court nominee Elena Kagan cleared the first hurdle toward confirmation on Tuesday with the Senate Judiciary Committee recommending approval of the nomination on a nearly party-line vote of 13-6.

Sen. Lindsey Graham of South Carolina was the only Republican to join all Judiciary Committee Democrats in voting to approve President Obama’s selection of Kagan to succeed retiring Justice John Paul Stevens. Midway through a two-and-a-half-hour meeting, Graham said he disagreed with Kagan’s judicial philosophy, but he noted it was not his place to stonewall her confirmation. “I understood we lost; President Obama won,” Graham said.

Democrats, led by committee chairman Patrick Leahy, D-Vt., praised Kagan’s knowledge of the law, ability as a consensus-builder, and willingness to fairly apply the law. “Her credentials and legal abilities have been extolled by many,” Leahy said, citing support for Kagan among liberal and conservative legal-minds, including Miguel Estrada, a well-known conservative lawyer whose nomination by President George W. Bush for a federal court was filibustered by Senate Democrats.

The committee’s ranking Republican, Alabama’s Jeff Sessions, led the GOP attack by criticizing Kagan as having been “at best inaccurate” and at worst “dishonest” in explaining her role as dean of Harvard Law School in limiting access of military recruiters because of the military’s “don’t ask don’t tell policy." Sessions also faulted Kagan for what he called "her lack of a robust legal experience.”

Other Republicans followed by criticizing Kagan for her policy positions as a White House adviser under President Bill Clinton and her handling of some cases as solicitor general in the Obama administration, including a pending challenge to the "don’t ask don’t tell" policy.

Republicans and some Democrats criticized Kagan for evasive answers during 17 hours of testimony before the committee. Sen. Herb Kohl, D-Wis., said that her answers were frequently so general that it was “difficult to distinguish her answers from those of other nominees.” But Sen. Charles Schumer, D-New York, said Kagan had been more candid than previous nominees, including Chief Justice John G. Roberts Jr.

Republicans criticized Kagan, who has no prior judicial experience, as a likely judicial activist on the court. Democrats countered by citing several Roberts Court rulings as activist, including the controversial campaign finance case known as Citizens United that allows unlimited political spending by corporations and unions.

Democrats also claimed that Kagan’s unique background would provide her with a vital perspective that would differ from the other justices on the bench. Sen. Amy Klobuchar, D-Minn., noted Justice Antonin Scalia’s comment that Kagan’s lack of judicial experience was a positive attribute since she would be the only one on the court that has not served as a judge.

At the White House, President Obama praised the committee’s vote as “a bipartisan affirmation of [Kagan’s] strong performance during her confirmation hearings.”

The committee’s vote sets the stage for a Senate floor vote on Kagan’s nomination before Congress begins its August recess. If approved by the full Senate body, Kagan would be the fourth woman justice appointed to the Supreme Court; and for the first time, three female justices would serve on the bench at the same time. And, at age 50, she would also be the youngest justice to join the Court since Clarence Thomas was appointed at age 43 in 1991.

With Democrats holding a 59-41 majority, Congress watchers say Kagan’s confirmation is a foregone conclusion. “Elena Kagan will be confirmed. She will go on the Supreme Court,” Leahy told reporters after the meeting. Sessions declined to predict how many Republicans would vote to confirm Kagan. Nine Republicans joined Democrats one year ago in voting to confirm then-judge Sonia Sotomayor by a vote of 68-31.

FCC Ban on Expletives Struck Down

By Kenneth Jost
Supreme Court Editor, CQ Press
      A federal appeals court has struck down the Federal Communications Commission’s policy banning so-called “fleeting expletives” on radio or television.
      In a unanimous ruling Tuesday [July 13], a three-judge panel of the Second U.S. Circuit Court of Appeals called the 2004 policy “impermissibly vague” and likely to result in “self-censorship” by broadcasters apprehensive of FCC penalties for broadcasting an otherwise worthwhile program with a single use of a prohibited obscenity.
      “Under the current policy, broadcasters must choose between not airing or censoring controversial programs and risking massive fines or possibly even loss of their licenses, and it is not surprising which option they choose,” Judge Rosemary Pooler wrote for the court in Fox Television Stations v. FCC. “Indeed, there is ample evidence in the record that the FCC’s indecency policy has chilled protected speech.”
      The ruling marked the second time the New York-based appeals court has struck down the FCC policy, which tightened the agency’s indecency rule to prohibit even a single use of what the Supreme Court later called “the F word” or “the S word.” In June 2007, the Second Circuit ruled that the FCC had not adequately justified the change in policy.
     In its earlier ruling, the Second Circuit voiced doubts about the constitutionality of the policy, but left the question unanswered. In 2009, the Supreme Court reversed the appeals court on the administrative law question and sent the case back for a ruling on the First Amendment issue raised by Fox and other broadcasters.
      Fox TV stations had been found liable but not penalized for broadcasts of the 2002 and 2003 Billboard Music Award programs. In the 2002 program, the entertainer Cher extemporaneously used the “F” word to refer to her critics. In the 2003 program, the TV celebrity Nicole Richie made unscripted use of both the “F” word and the “S” word in a comic dialogue with co-star Paris Hilton.
      The appeals court’s 32-page opinion cited apparent inconsistencies in the FCC’s enforcement of its rule. Pooler noted that the FCC raised no objection to the use of obscenities in the World War II movie “Saving Private Ryan,” but did object to obscenities in a public broadcasting documentary, “The Blues.” The judge speculated that the FCC was “simply more comfortable” with the themes in a “mainstream movie” than with a documentary about “an outsider genre of musical experience.”
      “Even if there were a perfectly benign way of explaining these particular outcomes,” Pooler wrote, “nothing would prevent the FCC from applying its indecency policy in a discriminatory manner in the future.”
      In its policy, the FCC had urged broadcasters to use tape delay to guard against unscripted obscenities in live programs. Pooler noted, however, that tape delay had been in use in the 2003 awards program, but the two expletives “slipped through” anyway. “Even elaborate precautions will not protect a broadcaster against such occurrences,” she wrote.
      The FCC policy includes an exception for “bona fide news programs,” but Pooler said that even so some broadcasters had dropped planned coverage of events because of fears that speakers would use an offending word. She also said that some broadcasters had decided to rewrite or not to broadcast programs with sexual themes even though no obscenities were scripted or uttered.
      Pooler closed by leaving open the question whether the FCC could create a constitutional policy. “We hold only that the FCC’s current policy fails constitutional scrutiny,” she wrote. Judges Pierre Leval and Peter Hall joined her opinion.
      The FCC had no immediate comment, but an appeal to the Supreme Court seems likely.
      For background, see William Triplett, “Broadcast Indecency,” CQ Researcher, April 16, 2004.

Kagan Praised, Assailed; Hearing Ends

By Kenneth Jost
Supreme Court Editor, CQ Press
      The confirmation hearing for Supreme Court nominee Elena Kagan ended late Thursday evening [July 1] with witnesses praising her intellect and her record as dean of Harvard Law School and U.S. solicitor general or attacking her as anti-military and as a likely activist justice if confirmed.
      Only a few members of the Senate Judiciary Committee were present as the 24 witnesses recapitulated positive assessments and sharp criticisms made of Kagan in the seven weeks since President Obama selected her on May 10 to succeed the retiring Justice John Paul Stevens.
      Kagan’s actions at Harvard in limiting official aid to military recruiters because of the “don’t ask, don’t tell” policy on gays in the military continued to be the most concrete criticism from conservatives, echoed by Republican senators. But conservative advocates on Thursday also warned that, if confirmed, Kagan would oppose Second Amendment gun rights, support a constitutional right to gay marriage, and reject abortion regulations.
      David Kopel, a gun-rights advocate and research director for the Colorado-based Independence Institute, said Kagan’s testimony had “raised rather than allayed” concerns that she would not support Second Amendment rights on the court. In her testimony, Kagan said she regarded the Roberts Court’s two pro-gun rights rulings, including the decision on Monday extending the Second Amendment to state and local governments, as “precedent” and “settled law.” Kopel called the answers “platitudes.”
      On gay marriage, Tony Perkins, president of the socially conservative Family Research Conservative, pointed to Kagan’s support of what he called “open homosexuality” in the military as evidence that she would support a constitutional right to recognition for same-sex couples. “We do not need a justice on the Supreme Court who sees it as her life mission to write the Roe v. Wade of homosexual rights,” said Perkins, referring to the landmark abortion rights decision. Kagan declined to address the issue directly in her testimony, saying the issue was likely to come before the court.
      On the abortion issue itself, Catherine Yoest, president of Americans United for Life, pointed to Kagan’s opposition while a White House adviser under President Bill Clinton to a pending bill to bill so-called partial birth abortions. Yoest said her role “demonstrates her hostility to any regulation of abortions.” In her testimony, Kagan denied accusations that as a White House adviser she had acted improperly in trying to reshape statements on the issue by medical groups.
      The conservative attacks were in sharp contrast to high praise for Kagan’s qualifications from the American Bar Association, Kagan’s Republican-appointed predecessor as solicitor general, and former colleagues and students at Harvard. The ABA’s Standing Committee on the Federal Judiciary, which regularly evaluates nominees for federal judgeships, gave Kagan its highest rating of “well qualified.”
      Kim Askew, a Dallas lawyer and chair of the ABA committee, said Kagan’s “professional qualifications” are “exceptionally outstanding in all respects.” Askew stressed that, in line with the ABA’s practice, the group was evaluating Kagan’s professional qualifications only and not taking a position on her confirmation.
      By contrast, Gregory Garre, who served as solicitor general in the last year of President George W. Bush’s administration, appeared as one of eight former solicitors general who had signed a letter endorsing Kagan’s confirmation. Garre gave Kagan high marks for her 14 months as the government’s chief advocate before the Supreme Court and said her service would be “a tremendous asset” on the court.
      The Republican minority on the committee packed its witness list with current or retired military officers to highlight criticism of Kagan’s decision to bar military recruiters from assistance by the school’s Office of Career Services. Kagan said that the action reflected the school’s policy of requiring nondiscrimination pledges by employers but that she also facilitated military recruiters’ access through a student veterans’ group.
      Flagg Youngblood, a captain in the California Army National Guard and former director of military outreach for the conservative Young Americans for Freedom, said Kagan’s testimony was false and her actions in violation of the federal Solomon Amendment, requiring equal access for military recruiters. “A vote to confirm Solicitor General Elena Kagan,” said Youngblood, “is a vote against our military.”
      But Kurt White, a captain in the Army National Guard and president of the Harvard Law Armed Forces Association, called the accusations of Kagan’s anti-military bias “untrue and unfair.” As a student at Harvard Law School, he recalled that Kagan made a point of praising veterans at the first-years’ opening convocation and later invited veterans to dinner at her home on Veterans Day.
      The four-hour session drew only limited attendance, with no more than seven of the 19 senators present at any time. The press tables and radio and TV booths were also largely empty.
      The committee is expected to vote on Kagan’s nomination sometime in mid-July, with a Senate floor vote expected by early August. With Democrats enjoying a 58-41 majority and Republicans having gained only limited traction with their criticisms, Kagan is seen as all but certain to win confirmation, in plenty of time to join the court well before the opening of the new term on the traditional first Monday in October.