Delay, Delay, Delay: Goldman's Senate Hearing Strategy Seems To Hinge On Wasting Time

The Goldman Sachs executives testifying before a Senate governmental affairs subcommittee Tuesday have dawdled, dodged and diverted their way through a hearing on Goldman's role in the financial crisis.

They asked for questions to be rephrased and clarified. They squinted and paged through thick notebooks, "searching" for emails printouts they were being asked about. They often appeared confused, bewildered.

On its face, it was not a heartening display of intellectual wizardry from these Titans of Finance.

Check out our highlight reel here:

"I cannot help but get the feeling that a strategy of the witnesses is to try to burn through the time of each questioner," said Sen. Susan Collins (R-ME).

As it turns out, this actually may be their official strategy.

Check out this quote from K. Lee Blalack II -- hired by Goldman to prep its execs for today's hearing -- in a 2009 article in The American Lawyer (.pdf).

Blalack says a well-trained witness can minimize exposure by simply running out the clock: "Long, thoughtful pauses followed by rambling nonresponsive answers can easily devour half of a member's allotted questioning time."

According to the magazine piece (titled "Painful Scrutiny"), Blalack guides clients -- many of them large financial firms -- "through the legal minefields of hostile congressional investigations." Particularly tough is the place Goldman execs are testifying today: Levin's Permanent Subcommittee on Investigations. "Pretty scary investigations" is how one attorney put it. That's the panel "that can really get a client in trouble," Seth Hettena writes in The American Lawyer. But it's also where "Blalack and a small group of D.C. white collar attorneys thrive."

Blalack is a partner at O'Melveny & Myers LLP. He did not immediately return TPM's call seeking comment. Neither did Goldman Sachs, or subcommitee chair Sen. Carl Levin's (D-MI) office.

Here's Blalack advice to clients, according to Hettena's piece:

So to avoid his client getting buried, how does Blalack prepare him or her for a day before the committee? He tells them that the congressional hearing room is not a forum for getting at the truth. Don't get on a soapbox. A day in the klieg lights should end with minimal damage to reputation while not complicating a client's position in other investigations or litigation. Blalack says a well-trained witness can minimize exposure by simply running out the clock: "Long, thoughtful pauses followed by rambling nonresponsive answers can easily devour half of a member's allotted questioning time."

Not exactly an exercise in brevity or clarity.

And for more compelling moments from today's hearing:

• Sen Carl Levin (D-MI) ripped a Goldman executive for pushing a financial product on customers after a colleague had labeled it a "shitty deal."
• Sen. Claire McCaskill (D-MO) tells Goldman execs why they're just like bookies.
• Goldman execs won't apologize -- or express regret.

Reel by Michael Sweeney.