But right now Obama has the biggest Democratic majority in the Senate he's ever going to have. So why not use it to ensure a solidly progressive nominee like Diane Wood instead of an ideological cipher like Kagan?
He doesn't have to do this. Unfortunately, the most likely answer is: he does it because he wants to.
I didn't go to Harvard Law School with Kagan like the New Yorker's Jeffrey Toobin did—not only that, he's good friends with her and her family—but my initial reaction to the same question was identical to his:
As it happens, this weekend I was finishing “The Bridge,” the new biography of Obama by David Remnick, our boss here at the magazine. Since Kagan’s nomination was imminent, I was struck by certain similarities between the President and his nominee. They are both intelligent, of course, but they also share an ability to navigate among factions without offending anyone. Remnick’s Obama is very… careful. He takes no outlandish stands or unnecessary risks. He is an exquisite curator of his own career. All of this is true of Kagan as well.
Toobin also notes that one of Kagan's great professional achievements as a dean has been bringing peace and order to the factions at Harvard Law; Obama famously did the same at the school's law review. One ideologically peacemaking cipher picks another, who promises not to cause much of a fight in her confirmation process: it's a match made in heaven, if that's your idea of heaven.
Update Her senior thesis was "an exploration of the history of American radicalism." If you followed the shitfit about Michelle Obama's thesis, you'll know this will provide for some great hilarity.