Saturday, December 4, 2010

Politics and Economics: Magnuson’s Threat and Obama’s Problem

The Gubernatorial Recount

The Minnesota Canvassing Board met yesterday (12-3-10) to review ballot challenges during the Minnesota governor’s race recount. Two fascinating things emerged: First the numbers regarding the challenge, second the dialogue between Tom Emmer’s lead lawyer, Eric Magnuson and state Supreme Court Justice Paul Anderson.

First, with almost all of the recount done, Dayton still leads by approximately 8,800 votes. The recount, as of 2 PM yesterday, yielded 2,880 frivolous challenges by either the Dayton or Emmer side, and 909 non-frivolous by the same. The total is 3,579, the bulk of them coming from the Emmer camp. The Dayton camp had then announced it was withdrawing all these challenges.

When the Canvassing Board examined the frivolous challenges, it became clear to all that they were in fact frivolous. For example, in Renville County Emmer people appeared to challenge all ballots where there was a write-in candidate for the school board. Clearly Magnuson when confronted with that fact was embarrassed and had to admit that he needed to withdraw these challenges.

What the review of the ballot challenges demonstrated is a couple of things. First, even if all the challenges by Emmer broke his way he could not eliminate the 8,800 vote lead that Dayton has. Second, the frivolous challenges were just that–frivolous–and they will be rejected. This further narrows any gain that Emmer may have.

Overall, what the recount suggests is that for the most part the Minnesota election system is probably 99.9%+ accurate in reading voter intent and counting. The final vote after the recount will be essentially the same as it was before the recount started.

These facts are increasingly clear to Emmer’s attorney Eric Magnuson. I enjoyed the exchange between them. Anderson first pointed out that lawyers cannot bring frivolous lawsuits (Rule 11 as we all learn as 1L law students). Bringing such suits is sanctionable and unethical for lawyers. Second, Anderson asked Magnuson if he really wanted the Canvassing Board to review all the frivolous challenges even though it would potentially take a lot of time and even if he did prevail, they still would not win.

This is where Magnuson offered a threat. He said that he expected the Board to do its job and review all these ballots in the interest of obtaining an accurate count. He did not address the issue that the numbers do not work for them. His threat seemed to be if you do not examine them now (which could delay finishing the recount and certifying Dayton the winner) then Emmer might have to ask a court to do that later.

Thus, the real strategy emerges–and Anderson pointed it out. Emmer and Magnuson seek to delay the recount process now and perhaps make it difficult for Dayton to take office on January. If the Canvassing Board does not do what they want then they will go to court afterward to raise their legal challenges–even if it does not change the result. There is also no promise that they will not seek to delay now and go to court later. Thus the threat.

As I watched the hearing I thought a lot about legal ethics. I teach professional responsibility or legal ethics to law students. Anderson was correct that lawyers cannot bring frivolous claims and we have an obligation not to use the legal process simply to obstruct justice. That is what is going on here. I thought also about how current Minnesota law allows an election contest almost for any reason. Ethically, lawyers should not be able to bring election contest suits unless they can show that were they to prevail in their arguments the result of the election would have gone the other way (they would have won).

The ethics problem I see here is that even if Emmer could prevail in all his legal arguments, that will not produce enough votes to change the outcome of the race. Dayton still wins. If legal ethics does not prevent bringing this type of suit, counseling a client such as Emmer (who is also a lawyer) that he should not take this type of action because it is purely vindictive should be what we ask of a client. But in the end, I recommend we amend Minnesota election law. The law should say that one does not have an automatic right to file a contest. Instead, there must be a “but for” threshold that needs to be met. By that, an attorney would have to plead that but for the legal mistakes made, the results would have been different. This should be the standard governing frivolous suits. If one cannot show the results would have been different then one should be barred from bringing the suit or judges should be allowed to dismiss on motion. This may still be a possibility for Dayton lawyers should Emmer go to court, but a statutory rule would be better here.

Economics: Obama’s Problem
Three bits of bad economic news this week. First, only 39,000 new jobs were generated for the American economy, pushing the unemployment rate to 9.8%. Second, the Financial Times pointed out this week that in the next few months 6.5 million homes will go into foreclosure. Third, The Economist pointed out that October, 2010 existing home sales dropped by 2% compared to September, and by 26% compared to October, 2009. Sale of foreclosed or distressed homes constituted 34% of all sales in October, 2010.

The US economy remains weak, despite the consumer holiday shopping rush and record profits for corporate America. With an anemic GDP growth rate in the third quarter of 2.5%, unemployment is not turning around soon. Weak employment and home sales (and continued foreclosures) suggest more aggressive measures are needed to help the economy. However, I see little coming from the Obama administration, even without the coming gridlock from a new GOP Congress.

Obama has a problem. Yes “it’s the economy, stupid,” but it is also him. He helped the banks and they are again profitable but he failed to help homeowners and jobseekers very much. Getting extended unemployment benefits is a short term fix, but does not to really help the economy, those looking for work, or those losing their homes. Obama and his economic team never seemed to get it in the first 22 months and they still seem clueless about the need to directly intervene into the mortgage markets to stabilize the economy and to take more direct action to encourage job growth. Simple tax cuts that are not targeted will not solve those problems.

The economy wrecked Bush I when he ran for re-election. This is Obama’s problem now to worry about.

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