Reagan: The Life

by H. W. Brands

  Bork wasn’t obviously more conservative than Scalia, but his nomination came at a moment when the Democrats were more effectively combative than they had been in 1986. They now controlled the Senate and with it the all-important Judiciary Committee, which would conduct hearings on the Bork nomination. Democratic hopefuls for the 1988 presidential race were already jockeying for position, with each tempted to outdo the others in attacking the administration. And because Bork would replace a moderate justice, Democrats realized that his seating could reconfigure the balance of power on the court for decades to come.

  They determined to block the nomination. Narrowly partisan calculations entered their thinking: they hoped to embarrass the president and his party ahead of the 1988 elections. Legal philosophy mattered too. Bork’s version of judicial restraint had caused him to question federal authority on certain civil rights issues, alarming advocates of equality for minorities and women. His willingness, as acting attorney general in 1973, to fire the Watergate special prosecutor at the order of Richard Nixon, after his two superiors in the Justice Department resigned in protest, caused liberals and not a few moderates to wonder if, notwithstanding his rhetoric of restraint, he was really a pushover for executive power.

  The Democratic attacks commenced at once. Senator Edward Kennedy of Massachusetts assailed Bork as hostile to the ordinary people of the country. “Robert Bork’s America is a land in which women would be forced into back-alley abortions, blacks would sit at segregated lunch counters, rogue police could break down citizens’ doors in midnight raids, schoolchildren could not be taught about evolution, writers and artists could be censored at the whim of the government and the doors of the federal courts would be shut on the fingers of millions of citizens,” Kennedy said. Senator Joseph Biden of Delaware, the chairman of the Judiciary Committee, spoke less melodramatically but, for this reason, more persuasively. Biden reflected on Bork’s writings and expressed concern that they signaled a mind already closed on critical issues that could come before the court. Biden didn’t think he could approve such a nominee. “Unless he can demonstrate that he carries to the court more of an open mind, I would have a tough time,” Biden said.

  Reagan dismissed the critics as partisan blowhards. “Some talk about Bork and last night’s broadcast featuring all the Democratic candidates for president,” he wrote in early July. “There was a lot of demagoguery.” A few days later he predicted, “We’ll get Bork confirmed to Supreme Court but it will be a battle with left-wing ideologues.”

  Howard Baker was just getting used to Reagan’s governing style. “The president had high confidence that he could move anything, whether it was a vote on an issue or a nomination or a treaty,” the chief of staff recalled. “He was supremely confident. He took account of the fact that there were big storm warnings about Bork ahead of time but it was very Reagan-like to say, I want to do it anyway, and he did.”

  Summer delayed the hearings on Bork until mid-September, allowing the opposition to organize. Bork’s testimony at the hearings differed in tone and sometimes substance from his published opinions, causing critics to allege a confirmation conversion. Bork explained the discrepancy as contextual. His more provocative pieces had been written when he held academic positions, where provocation was the point, he said. As a judge he had taken, and would continue to take if confirmed, more measured positions. He defended his record on civil rights and women’s rights. “Beginning with Brown v. Board of Education, I have supported black equality,” he told the committee. “I have never said anything or decided anything that should be frightening to women.” He denied he was tailoring his testimony to win over wavering senators. “It would really be preposterous for me to sit here and say the things I have and then go on the court and do the opposite,” he said. “I would be disgraced in history.”

  Bork’s critics on the committee weren’t appeased. “You are not a frightening man, but you are a man with frightening views,” Howard Metzenbaum of Ohio declared, referring to a Bork appeals court ruling permitting a chemical company to offer women employees a choice between sterilization and dismissal. After Bork defended his ruling as being neither pro-sterilization nor antiwomen, Metzenbaum continued, “Judge, I must tell you it is such a shocking opinion. I don’t understand how you as a jurist could put women to a choice to be fired or sterilized.” He added, “I cannot tell you strongly enough that the women of this country are terribly, terribly apprehensive about your appointment.” Metzenbaum frowned. “The women’s groups are afraid. The fact is, Judge Bork, they do fear you. Blacks as well.”

  Bork grew testy under the interrogation. “I can’t say this enough times,” he said. “I supported black equality. I have never said or decided anything that should be frightening to women.” On civil rights in particular, he declared, “If I were a black man and knew my record as solicitor general and a judge, I would not be concerned, because my civil rights record is a good one.” He again denied he was shaping his remarks to curry senators’ favor. “For sixteen years I have been saying one thing about the courts—they have to be guided by the intentions of lawmakers, with some respect for precedent. If I got on the Supreme Court and did anything else, I’d be a fool in history. I suppose that’s the best guarantee I can give you.”

  BY THE END of the hearings the nomination was in peril. Reagan belatedly lit a backfire. He lobbied fence-sitting senators and threatened to leave the ninth seat on the court unfilled if the Senate rejected Bork. He conspicuously denied rumors that he might abandon the nominee. In early October he met with a group of high school principals in the White House Rose Garden. As they walked to the Oval Office, Sam Donaldson shouted a question as to whether Bork’s nomination was finished. “Over my dead body,” Reagan replied. The president smiled as he related the incident in his diary. “The principals cheered and then moved in on the press gang giving them h--l.”

  Yet Reagan could count votes, and as the Democrats dug in, he gradually realized the nomination would fail. He didn’t abandon Bork, but he nudged the door open for Bork to exit on his own. “Mr. President, fifty-one senators now oppose Judge Bork,” a reporter said. “He can’t make it. He can’t make it, sir. Fifty-one senators have announced their opposition.”

  Reagan responded to the implied question. “He has a decision to make,” the president said. He added, “I have made mine. I will support him all the way.”

  “Would you accept his decision, whatever it may be?” a reporter pressed.

  “Well, obviously I’d have to,” Reagan said.

  Was the president giving up?

  “It would be impossible for me to give up in the face of a lynch mob,” Reagan said.

  Bork wouldn’t give up either. He declined the exit Reagan offered, insisting on a vote of the full Senate. Reagan had no choice but to stand behind him. “Judge Bork and I agree that there are no illusions about the outcome of the vote in the Senate, but we also agree a crucial principle is at stake,” the president declared. “That principle is the process that is used to determine the fitness of those men and women selected to serve on our courts. And the ultimate decision will impact on each of us and each of our children if we don’t undo what has already been done and see that that kind of performance is never repeated.”

  Reagan tried to hold the high moral ground, but his exasperation sometimes got the better of him. He met with Republican senators to discuss the Bork nomination. “I assured them I would not soften my requirements for a Supreme Court justice and please the lynch mob,” he recounted in his diary. At a Republican fund-raiser a woman shouted, “We want Bork!” Reagan responded, “So do I. What’s at issue is that we make sure that the process of appointing and confirming judges never again is turned into a political joke. And if I have to appoint another one, I’ll try to find one that they’ll object to as much as they did to this one.”

  In fact he did the opposite. After the Senate handed Reagan the most lopsided defeat of a Supreme Court nomination in history
—Bork lost by 58 to 42—the president decided to cut his losses. He quickly nominated Douglas Ginsburg, chosen chiefly for being noncontroversial. Reagan admitted as much in announcing the nomination. “By selecting Judge Ginsburg, I’ve gone the extra mile to ensure a speedy confirmation,” he said. “I’ve been impressed by the fact that in academia, in government, and on the bench Judge Ginsburg has been enormously popular with colleagues of all persuasions.”

  But Reagan’s haste contributed to a failure of vetting, and within days reporters discovered something the administration had not: that Ginsburg had used marijuana as a young man. Reagan initially dismissed the news as inconsequential. “It was a brief thing back when a lot of people experimented a bit and that’s all it amounted to,” he wrote in his diary. “I think the fellow who leaked it was a friend at the time who smoked it with him. I don’t see any reason why I should withdraw his name.”

  Another president might have ridden out this new controversy. But Nancy Reagan had made the suppression of illegal drug use her principal public cause, and with Nancy imploring the nation’s youth to “just say no,” the president could hardly say yes to an admitted user.

  Reagan resisted admitting he had erred again. Bill Bennett, the secretary of education and the second most conspicuous foe, after Nancy, of illegal drugs, called Reagan and asked him to pull the Ginsburg nomination. “I told him that was absolutely impossible,” Reagan wrote.

  But then Ginsburg offered to withdraw, and Reagan went along. “It looks increasingly that he cannot be confirmed and he’s taken enough abuse,” he wrote.

  Reagan finally succeeded on the third try. Anthony Kennedy’s past was closely examined for troublesome indiscretions. “FBI check on Judge Kennedy: clean as a whistle,” Reagan noted with relief. His personal life appeared a model of decorum. “Lovely wife; beautiful daughter, sophomore at Stanford; son who is a senior at Stanford; and son who is out in business.” And he was politically uncontroversial. “So far we’ve heard encouraging words that he has bipartisan support from Dems and Repubs.”

  The hearings went smoothly. “They didn’t lay a glove on him,” Reagan wrote with satisfaction. The holidays pushed back the final decision, but in early 1988 the Senate approved the Kennedy nomination by a vote of 97 to 0.

  102

  IN THE SUMMER of 1987, Paul Volcker completed his second term as chairman of the Federal Reserve. Reagan had reappointed him four years earlier because not doing so might have risked another recession ahead of the president’s reelection campaign. “The financial market seems set on having him,” Reagan wrote in the summer of 1983. “I don’t want to shake their confidence in recovery.” An additional reason for reappointing Volcker was that he hinted he wouldn’t stay for a full four years. “I think we’ll reappoint Paul Volcker for about a year and a half,” Reagan wrote. “He doesn’t want a full term.”

  Within months of Volcker’s reappointment, Reagan was having second thoughts. “Lew Lehrman came by with some disturbing info about Paul Volcker and his strong belief that we should slow our business growth,” Reagan wrote in early 1984. Lehrman was an investment banker, conservative activist, and recent Republican nominee for governor of New York. “Paul is obsessed with a fear of returning inflation and according to Lew would seek to use the Fed to slow our recovery.” By phone, in person, and through such proxies as Donald Regan, the president pressured Volcker to loosen the reins on the money supply. But Volcker set his own course. “The Fed has pulled the string on the money supply and it’s down to one-half the rate of growth in the economy,” Reagan grumbled the week before the election. “Don is trying to goose Paul V. into a little action before he brings on more of a lull.”

  Perhaps Volcker had indeed intended to resign before his second term ended, or perhaps Reagan misinterpreted the signals he sent. Whatever the case, Volcker apparently decided, in the face of the persistent pressure from the White House, that he needed to stick around lest the progress that had been made against inflation be undone. And his stubbornness confirmed Reagan’s belief that two terms for Volcker were more than enough. “We’re going to see if Alan Greenspan will take the job if Paul will step down gracefully,” Reagan wrote in the spring of 1987.

  Volcker agreed that the time had come for a change in the leadership of the Fed, and Reagan announced Greenspan’s nomination that June. He assured reporters, the markets, and the country at large that the change at the Fed signaled no slackening of the administration’s commitment to keep inflation in check. “We’ve had a miraculous fifty-odd months of bringing inflation down,” Reagan declared. “Now there is something of a little surge again, in large part, precipitated by energy prices. But I have perfect confidence in Alan Greenspan and his philosophy and that what he would do would curb that and not let inflation get out of hand again.”

  Inflation proved to be just one of the challenges Greenspan encountered in his first months on the job. “I felt a real need to hit the ground running because I knew the Fed would soon face big decisions,” Greenspan recalled. The economic expansion that had begun after the recession of Reagan’s first term was in its fourth year, but signs of instability were growing more evident. The stock market had soared 40 percent since the beginning of the year, with little sign of slowing. “Wall Street was in a speculative froth,” Greenspan recounted. The federal budget provided no solace. “Huge government deficits under Reagan had caused the national debt to the public to almost triple, from just over $700 billion at the start of his presidency to more than $2 trillion at the end of fiscal year 1988.” Inflation was creeping upward again, from less than 2 percent to nearly twice that. This was still far below the double-digit rises of the 1970s, but it was worrisome all the same. “We were in danger of forfeiting the victory that had been gained at such great misery and cost under Paul Volcker,” Greenspan wrote.

  To dampen the inflationary pressures, Greenspan persuaded the Fed board to boost interest rates. This was a big step, as the Fed hadn’t raised rates in three years. “I couldn’t help but remember accounts I’d read of the physicists at Alamogordo the first time they detonated an atom bomb: Would the bomb fizzle? Would it work the way they hoped? Or would the chain reaction somehow go out of control and set the earth’s atmosphere on fire?”

  The sky didn’t catch fire, but the stock market imploded. The Dow Jones average lost 6 percent the first week in October, then 12 percent more the next week. On a single day—Friday, October 16—the Dow plunged 108 points. Greenspan and the rest of the country held their collective breath waiting for the markets to reopen on Monday.

  The early news that day was grim. The Dow fell another 200 points in morning trading. Greenspan was scheduled to speak in Dallas, and he boarded a plane to fly west. For three hours he was out of touch. His first question on landing was how things had ended on Wall Street. “Down five-oh-eight,” his Dallas host, from the local branch of the Fed, replied.

  Greenspan sighed relief, thinking that a loss of 5.08 was far better than he could have expected. But the look on his host’s face revealed that the news was not good but very bad: the Dow had fallen 508 points. This was the largest one-day loss in Wall Street’s history, bigger than any single day’s beating in the crash of 1929. Trillions of dollars had vanished in the blink of an eye.

  Greenspan at once appreciated the danger. He had studied the 1929 crash and the ensuing depression, and he knew what the Fed had done wrong. He determined not to repeat the mistakes of his predecessors. “I went straight to the hotel, where I stayed on the phone into the night,” he recalled. “The Fed’s job during a stock-market panic is to ward off financial paralysis—a chaotic state in which businesses and banks stop making the payments they owe each other and the economy grinds to a halt.” The senior people Greenspan spoke with shared his understanding of the crisis and the appropriate remedies. But some of the younger people, shaped more by the inflation of the 1970s than the depression of the 1930s, counseled caution. One suggested that the Fed wait and see wh
at was going to happen.

  “Though I was new at this job, I’d been a student of financial history for too long to think that made any sense,” Greenspan recounted. “It was the one moment I spoke sharply to anybody that night. ‘We don’t need to wait to see what happens,’ I told him. ‘We know what’s going to happen.’ Then I backed up a little and explained. ‘You know what people say about getting shot? You feel like you’ve been punched, but the trauma is such that you don’t feel the pain right away? In twenty-four or forty-eight hours, we’re going to be feeling a lot of pain.’ ”

  Greenspan flew back to Washington, where Reagan was trying to shrug off the bad news from Wall Street. “Are we headed for another great crash?” a reporter shouted at the president as he crossed the White House lawn. Reagan didn’t hear the question. “Are we headed for another great crash?” the reporter repeated. “Stock market,” another reporter offered.

  “Oh, the stock market,” Reagan replied. “Well, I only have one thing to say: I think everyone is a little puzzled, and I don’t know what meaning it might have because all the business indices are up. There is nothing wrong with the economy.”

  So what had caused the collapse? the reporters asked.

  “Maybe some people seeing a chance to grab a profit, I don’t know,” Reagan said. “But I do know this: More people are working than ever before in history. Our productivity is up. So is our manufacturing product up. There is no runaway inflation, as there has been in the past. So, as I say, I don’t think anyone should panic, because all the economic indicators are solid.”

  Greenspan knew the president was trying to be reassuring. And under the circumstances he could hardly speak otherwise. But Reagan’s comments reminded him of similar comments by Herbert Hoover amid the crash of 1929. He huddled with James Baker, who had a longer record with the president than he did. The two agreed to approach Reagan together. “We met with Reagan at the White House to suggest he try a different tack,” Greenspan recalled. “The most constructive response, Jim Baker and I argued, would be to offer to cooperate with Congress on cutting the deficit, since that was one of the long-term economic risks upsetting Wall Street.”