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at samsung.com From

0:33

the opinion pages of the Wall Street

0:35

Journal, this is Potomac Watch. A

0:39

federal appeals court upholds Pennsylvania's

0:41

ban on undated mail ballots

0:44

as the Republican Party tries to get

0:46

comfortable with early and absentee voting. Plus

0:48

former crypto king Sam Bankman Freed is

0:51

sentenced to 25 years in prison. Welcome

0:55

I'm Kyle Peterson with the Wall Street

0:57

Journal. We are joined today

1:00

by my colleagues, columnists Kim

1:02

Strassl and Alicia Finley.

1:05

Judges in Pennsylvania have been arguing

1:07

about these undated mail ballots in

1:09

Pennsylvania for four years now. The

1:11

first case goes back to 2020.

1:14

There was a Republican state Senate candidate

1:16

who was ahead. She was winning that

1:18

race until a court ordered the counting

1:21

of about 300 undated mail ballots in

1:23

Pennsylvania. And just to describe what this

1:25

looks like in Pennsylvania, you have a

1:27

mail vote, you have an envelope that

1:30

it goes inside to send it back

1:32

and you're supposed to sign it. And

1:35

then there's a field that says date or today's

1:37

date and you're supposed to fill it out with

1:39

the date that you are filling out the ballot

1:41

before you send it back in. There've

1:43

been a couple cases now in

1:45

federal court about these undated mail

1:47

ballots and whether federal law requires

1:49

them to be counted. And

1:52

Kim, the latest is

1:54

a ruling on Wednesday we got

1:56

from the Third Circuit Court

1:58

of Appeals. And interestingly,

2:01

this panel went the opposite

2:03

direction as a previous panel

2:05

of the Third Circuit. And their

2:07

opinion is that no, the state law

2:09

that says you have to date your ballot for your

2:11

ballot to count is perfectly valid

2:13

and is not overridden by federal

2:15

law. Yeah, it was a very,

2:17

very good decision. I'm so happy to

2:20

see it. And what they were doing

2:22

here, this panel, which I would note,

2:24

by the way, three judges were disappointed

2:26

by Democrats. Two of them overturned a

2:28

lower court judge who had claimed that

2:31

essentially the date provision

2:33

was optional. And that judge

2:35

had cited the Federal Civil

2:37

Rights Act. The Civil Rights

2:39

Act does prohibit states from

2:41

denying the vote based on

2:44

non-material errors or omissions

2:47

on voting-related documents.

2:50

But what this panel said is that

2:52

that didn't really apply here. They

2:54

noted the history of the Civil

2:56

Rights Act pointing out that it

2:59

really was aimed at sort of

3:01

literacy tests and other things that

3:03

were deliberately done at the

3:05

time of the Jim Crow era to keep

3:08

blacks from being able to have

3:10

their ballots counted. And they would

3:12

catch them up with literacy tests

3:14

or misspellings of the state name,

3:16

things like that. Instead, this

3:18

panel looked at the state law in question,

3:20

which by the way, has been upheld by

3:22

the state Supreme Court. It noticed

3:25

that there's no limiting principle if you

3:27

say the date doesn't count because the

3:29

law basically has all kinds of

3:32

provisions related to voting documents. You

3:34

have to sign it. You

3:36

have to put the date on it. They have to come

3:38

in if they're in mail-in ballots with

3:40

secrecy envelopes. And what this

3:43

panel essentially said is if you're

3:45

basically going to judge that this

3:47

one thing is not necessary,

3:49

then you could do it for pretty

3:51

much anything. And it noted that other

3:54

states have other provisions and

3:56

pointed out that this all is meant to

3:58

be part of a state. interest

4:00

in having set vote casting rules.

4:03

The key line from this opinion

4:05

was the ruling cannot be reconciled

4:07

with the text and historic backdrop

4:10

of the statute nor calved to

4:12

the date requirement while leaving intact

4:14

other vote casting rules that serve

4:16

a valid state interest. But it

4:19

was a good, good opinion. The

4:21

reason it's important in my mind is that

4:23

as Kim relates states have all

4:26

sorts of rules for validly

4:28

casting a ballot. Another example

4:31

in Pennsylvania is the state law says that you're

4:33

supposed to fill out the mail ballot if you

4:35

have one in the same pen or pencil. And

4:37

so if the ballot comes in and half of

4:39

it is in red ink and half of it

4:42

is in blue ink, that

4:44

ballot might be set aside

4:46

and not counted. Pennsylvania also

4:48

requires secrecy envelopes for these

4:50

mail ballots. And so you end

4:53

up with sometimes hundreds of ballots

4:55

that come in without them or

4:57

with the secrecy envelope having some

4:59

kind of identifying mark on it.

5:01

And those ballots are also set

5:03

aside. And that's regrettable. And the

5:05

possibility of making that kind of

5:07

error, Alicia, to my mind is

5:09

one reason that many people might

5:12

prefer to go vote in

5:14

person where they're checked in and

5:16

they put the ballot in the slot or they push

5:18

the button on the machine and

5:20

they know that their vote is counted.

5:22

There's not some process of verifying it

5:24

and checking signatures and so forth that

5:26

happens after the vote leaves

5:28

their hand. But as regrettable as

5:30

it is that some people who

5:32

are gonna vote absentee inevitably every

5:35

year are gonna make errors. Alicia, I'm

5:37

persuaded by the argument that what is

5:39

worse is setting

5:41

up a system where the loser inevitably

5:44

is going to come to court after

5:46

the fact and say, well look over there, I only

5:48

lost by 50 and there's 300 Mail

5:51

votes sitting there in a stack that haven't been

5:53

counted. I Would like the judge to come in

5:55

and void some kind of piece of state law

5:57

in order to count those votes. And maybe just

5:59

maybe. Fingers crossed. That will be

6:01

enough to get me over the

6:03

finish line. That to my mind

6:06

the way to build confidence in

6:08

elections. Is to run a by the book.

6:10

And the rules of the game. That.

6:12

Are in place on election Day. Are the

6:15

rules of the game for that election? I

6:17

think that's right and me I recall going

6:19

back to kindergarten. We had this activity you

6:21

are Teachers in gave was. Seated

6:23

paper with very detailed directions and

6:26

needs. He didn't follow every single

6:28

one. Read the directions, your seat

6:30

or your paper was thrown out

6:33

when they intend to. That exercise

6:35

was to teach kids that you

6:37

need to follow directions to. the

6:39

cheese has certain instructions you need

6:42

to follow directions and bringing this

6:44

are applying this to the left.

6:46

And settings. It's important that.

6:49

People follow the directions and you

6:51

don't make exceptions are in this

6:53

sword that of this and or

6:55

this or that error because and

6:57

that leads to cries out that

6:59

was these rules are being unfairly

7:01

applied and when judges that the

7:03

in and is says they just

7:05

throw out the roses Anything? Have

7:07

people like Donald Trump try to

7:09

exploit this and claim that while

7:11

the election was raised the judges

7:13

basically overrule, the state legislator made

7:15

exceptions and I just fuels the

7:17

lack of confidence in suspicions. That

7:19

the lessons or so and and

7:21

and parsons and both parties can

7:23

do that. But interesting that this

7:25

comes as the republican party is

7:27

trying to get comfortable again. With.

7:30

Turnout Operations for early votes

7:32

Absentee votes in person Early

7:34

voting Muscles a New a

7:36

New Republican National Committee says

7:38

a lyrics from. On.

7:41

Fox News on Monday. Talking

7:43

about this. We. gotta play the hand

7:45

that were doubts and that means as soon

7:47

as you think they'll vote go vote out

7:49

there and then you spend your time every single

7:51

day from that day on until election day taking

7:53

people to vote we are going to have

7:55

a legal bad harvests and operation at the

7:57

rnc it's something that has never been done before

7:59

But yes, 224 days to victory. We

8:03

are going to get it done. We have no

8:06

other options. Kim, what do you make of this? And

8:08

the context that I would add to this is there is

8:10

a lot of reporting in 2020 that people around

8:14

President Trump were making these kinds of arguments

8:16

to him that as long as these rules

8:18

are in place, we have to get out

8:20

the early vote. We have to get out

8:22

the mail vote. And he was not persuaded

8:24

in that case. And that might be one

8:26

thing that contributed to his loss. It's really

8:28

good to see that Lara Trump

8:30

is taking this so seriously. I

8:32

think it's going to be really

8:34

important for Republicans going forward. Ronna

8:36

McDaniel, the former RNC head who

8:38

just left, she came

8:40

to understand how much

8:42

distrust on conservative side of

8:45

early and mail-in voting was

8:47

damaging the operation in major

8:49

elections. And so she had

8:51

already started an initiative called Bank the Vote.

8:55

And it's born out of the recognition

8:57

is, look, I agree

8:59

with Lara Trump, you have to

9:01

work the hand your doubts. In

9:03

my perfect world, we wouldn't have

9:05

voting months, okay, election months. And

9:08

we would try to reinstall in people

9:10

the sort of civic pride that comes

9:13

with showing up to vote on election

9:15

day. But the reality is, that's not

9:17

how many states have gone. And

9:20

what the RNC and other conservative

9:22

groups have been doing is fighting with almost

9:24

both of their hands tied behind their back.

9:27

Because essentially, Democrats are taking

9:29

six to eight weeks to get all

9:32

of their people to the polls and

9:34

accomplishing over that long period of time

9:36

what Republicans are trying to make up

9:38

in a space of 48 hours or

9:41

72 hours in the days leading immediately

9:43

to an election and on election day.

9:45

And also grappling with all the unknowns

9:48

that come with that. Maybe there's a

9:50

really important city and a very important

9:53

swing state that deals with the rainstorm

9:55

that day and the roads are closed

9:57

or there's a snowstorm or people get ill

9:59

or people suddenly need to travel and they're

10:01

not there on the day that they have to vote.

10:04

So it's been very difficult that they are

10:06

trying to catch back up. As Laura

10:08

Trump said, they've been playing

10:10

chess while we are playing checkers.

10:12

I think the impediment here is

10:14

still Donald Trump, who even though

10:16

he made a little video back

10:18

when Ronald McDaniel started bank the

10:20

vote, you know, saying nice things

10:23

about it, he continues to go

10:25

on television and say, oh, mail-in

10:27

votes, it's a recipe for fraud,

10:29

etc. And that spreads fear among

10:31

people not to take part in it. Hang

10:33

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Let's create. Welcome

11:10

back. I guess I would second what

11:12

Kim said before the break, which is

11:14

that I like to go vote in

11:16

person if I can, if I'm not

11:18

absent. Part of that, as I said

11:20

earlier, is the ability to know that

11:22

your vote is counted without worrying about,

11:24

did I make some error, like forgetting

11:26

to date my ballot or something like

11:28

that. Two is just the civic event

11:30

of it, the civic nature of it.

11:32

There are a lot of people who

11:34

like to go vote in person because

11:36

they take a 10-year-old before they take

11:38

the 10-year-old to school and talk about what

11:40

we do on this day and how great it

11:43

is to live in a

11:45

free American democracy. But it

11:47

is true that there

11:49

has been an enormous expansion

11:52

in voting options over

11:55

the past two decades or so. And that's part

11:57

of why I find this talk

11:59

of suppression that you are

12:01

often hearing on the left so

12:03

unconvincing. And I

12:06

would point to a recent

12:08

report by the Center for

12:10

Election Innovation and Research. And

12:13

what they did is they went and looked

12:15

at voting laws over the course of about

12:17

two decades. And here is one of their

12:19

conclusions. In the 2000

12:21

general election, 40% of all

12:23

voting age citizens lived

12:26

in states that offered at least one

12:28

option for voting before election day, such

12:31

as early in-person voting or mail ballots.

12:33

As of this writing, nearly 97% of

12:36

all voting age citizens will live in states

12:38

that will offer at least one option to

12:40

vote before election day in the 2024 election.

12:44

And so, Alicia, I agree with Kim that maybe

12:47

there is an argument to be made that

12:49

we are pushing too far in

12:51

the other direction of turning this into

12:54

voting months. And I

12:56

would also point to another report that looks specifically at 2022.

12:59

It says the percentage of voters casting ballots by

13:01

mail retreated to 32% in 2022, down more than

13:06

10 points from 2020, but more than double 2016. And

13:10

it is an amazing change in

13:12

the election system. I think that many people

13:15

probably don't realize how big of a change

13:17

that is. But even in a year like

13:19

2022, about a third of voters are casting

13:22

their votes from home. Right. In

13:24

recent years, a lot of states

13:26

have made changes, especially Democratic states

13:28

like California, Washington, Colorado have made

13:30

changes essentially allow all mail in

13:33

voting to make it more convenient,

13:35

in part because they realize some

13:37

of the liberal voters, young people

13:39

in particular, don't go out to

13:41

vote unless convenient or they're

13:43

extremely motivated like they were in

13:45

2008 to go out vote for

13:48

Obama. And so many

13:50

states, particularly left leaning ones

13:52

had eased the ballot access

13:54

by extending the duration of

13:57

early voting as well as

13:59

by promoting. providing essentially no excuse

14:01

absentee voting for people who are registered.

14:03

I mean, even in many cases, like

14:05

in states like California, you can basically

14:08

register on the day of election day

14:10

and cast a ballot. Now, the

14:12

problems here is that it does

14:14

create more issues when they are

14:16

counting ballots because then some people, their

14:19

challenge is to the ballot, they may

14:21

not have filled everything out right

14:23

on the registration, things have to

14:25

be double checked, some ballots get thrown

14:27

out. So it does provide

14:30

a lot more risk that elections could

14:32

be contested. In some cases, like in

14:34

California, again, I'm just talking back, they

14:37

have a week for the election offices

14:39

to even receive ballots from the mail.

14:41

And so oftentimes, you don't even

14:43

know who wins for another month

14:46

after election day, which

14:48

doesn't really increase confidence in the elections.

14:50

One other point I would make is

14:52

that generally conservatives and older voters are

14:54

more likely to vote in person. That's

14:57

just for many of the reasons that

14:59

you say they view it more as

15:01

kind of a civic duty, as a

15:03

civic exercise. Whereas again,

15:06

younger voters and liberal voters are

15:08

more likely to vote by mail.

15:11

I think there was a statistic that

15:13

I saw in 2022, nearly half of voters cast

15:15

ballots before election day, which was up from a

15:17

third in 2018. And

15:19

some of that is probably just the convenience and

15:21

then people do like it. And

15:23

I think that has actually helped in

15:26

some ways to increase voter turnout. So

15:28

there are kind of trade offs here.

15:30

Do we want more people casting ballots,

15:32

even if you extend the duration of

15:34

the voting and use different means like

15:36

the mail-in ballots? This is really a

15:39

state issue. And we're seeing that play

15:41

out with federalism. You know, states are laboratories

15:43

of democracy and there are pros and cons

15:45

both ways. And Kim, the point to me

15:47

here is that I understand the point of

15:50

absentee voting to give people an opportunity to

15:52

have their voices heard if they're going to

15:54

be out of town and so forth. But

15:57

these kinds of problems with faulty

15:59

ballots. effective ballots, late ballots, what do

16:01

you do if they come in after

16:04

election day? If you accept ballots that

16:06

arrive after election day, if they're postmarked

16:08

on time, those were small problems, I

16:10

think, back in 2000 or

16:12

so forth, when these kinds of ballots

16:14

were a small fraction of

16:16

the people who were voting. But when you start

16:18

to make that the norm, then they become much

16:21

bigger problems. Yeah. And I think

16:23

to round back to that decision that came

16:25

out about the Pennsylvania ballots, this

16:28

was something that they touched on as

16:30

well, too. They noted that when you

16:32

vote in person, you're subject to a

16:34

lot of rules, and that

16:37

you're required to follow them in the voting

16:39

booth as you go to turn your ballot

16:41

in. It's looked at, and sometimes we've

16:43

all gone through that experience where you go to

16:45

put it like, for instance, into the scanner,

16:47

and sometimes it first is not happy because

16:49

you didn't fill it out the right way

16:51

or something. You've got to do it

16:53

the correct way. One of the

16:55

important pieces that they had in this

16:57

opinion was noting that just because you're

17:00

doing a mail-in ballot doesn't mean that

17:02

you can't make a mistake and therefore

17:04

make your ballot defective. And

17:06

a state that sets aside a

17:08

defective ballot, the court ruled, is

17:11

not in any way denying the right

17:13

to vote. It's enforcing

17:15

the rules. So I think

17:17

that that puts an interesting question onto some

17:19

voters, which is that you do have to

17:21

be extra careful if you're doing mail-in voting,

17:23

et cetera, to make sure you get it

17:26

all right to ensure that your ballot is

17:28

actually counted. I think it poses an interesting

17:30

question to states about how to do this

17:32

in the most efficient manner possible. But I

17:34

think the last piece are these courts and

17:36

rulings like this because we

17:39

need to have all of these rules

17:41

very clear up front so that voters

17:43

understand completely what the upside is of

17:45

each of these different procedures that they

17:48

go through, what the consequences are going

17:50

to be if you don't do something

17:52

correctly, and that what the rules are

17:54

if you end up with these very

17:56

close recounts, because the absolute worst situation

17:59

is when up like we

18:01

did in 2020 with the ballots

18:03

counted, you're now to a recount,

18:05

one side is behind, and

18:08

you suddenly have courts stepping

18:10

in and then reinterpreting the

18:12

rules. That's what really diminishes

18:14

faith in election rules. Hang tight,

18:16

we'll be right back after one more break.

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forget you can reach the latest episode

18:53

of Potomac Watch anytime. Just ask your

18:56

smart speaker, play the opinion of Potomac

18:58

Watch podcast. From

19:02

the opinion pages of the Wall Street

19:04

Journal, this is Potomac Watch. Welcome

19:08

back. Let's turn to the sentencing

19:11

of Sam Bankman Freed, the

19:13

Crypto King founder of the

19:15

FTX Crypto Exchange, who

19:18

was sentenced this week to 25 years in prison. Just

19:20

to give a

19:23

sense of how that compares, white

19:25

collar crime, the journal has a

19:27

chart. Bernie Madoff got 150 years.

19:29

The CEO of WorldCom got 25

19:32

years. Jeffrey Skilling, the president of

19:34

Enron, got 14. A

19:36

name people might know from recent days,

19:38

Elizabeth Holmes, the founder of

19:40

Theranos, got 11 years

19:42

and 3 months. Alicia, what do you

19:44

make of this sentence and the conclusion

19:46

now of this whole FTX drama? So

19:49

I think the judge, I mean, he

19:51

had a lot of discretion as judges

19:53

do on the sentencing, but

19:55

I think he actually probably got it right

19:57

25 years in part, not just for the

19:59

egregious business of the fraud and then

20:01

he pointed to the lack of remorse

20:04

by Sam Bankman's reign. He continued to

20:06

insist at the trial that he really

20:08

didn't intend to defraud anyone. It was

20:10

just all honest mistakes. There was just

20:13

some number calculations. Then when he was

20:15

recalled, the issue here was

20:18

he had set up this

20:20

separate trading house Alameda that

20:22

was betting using customers cash

20:24

from his crypto exchange FTX

20:26

and he was continuously funneling

20:28

money to his Alameda trading

20:30

house but also using the

20:32

FTX customers deposits on

20:35

the exchange to buy real estate

20:37

in the Bahamas, to donate to

20:39

mostly left-leaning political groups and essentially

20:41

to expand his FTX empire and

20:43

to make risky bets that he

20:46

figured would pay off, right? He

20:48

didn't think he would get caught

20:50

was the problem. And then all

20:52

this started unraveling when you had

20:54

the Binance CEO, which was another

20:57

exchange, raised some questions about FTX

20:59

and how it was doing its

21:01

own accounting and people started selling

21:03

off and then pulling out their deposits

21:05

and all of a sudden FTX couldn't redeem it.

21:07

So it's essentially almost like a run on the

21:10

bank. And he just built this kind of a

21:12

house of cards and all of

21:14

a sudden started collapsing and then all of a

21:16

sudden he got caught and realized that he was

21:18

embezzling. And then he's like, well, you know,

21:20

I didn't really do anything wrong. Well,

21:23

no, sorry. The prosecutors clearly

21:25

showed that you were making

21:27

bets, you're taking other people's

21:29

cash in their accounts for

21:31

your own. That is a no-no in any

21:33

kind of securities business. And

21:36

he's kind of pleading ignorance. So I

21:39

think that again, going back to the sentence,

21:41

is it appropriate? My view is that it

21:43

is. Kim, what's your read of this? And

21:45

one thing to keep in mind is that

21:47

many prisoners don't serve their full sentences that

21:49

they get out after two thirds or something

21:51

like that with good behavior. And

21:54

my view, I guess, is that having not snapped

21:56

through the whole trial and watched the whole thing,

21:58

I'm generally reluctant to. weighed

22:00

into criticizing a judge's sentencing

22:02

because there are all sorts

22:04

of mitigating factors. You get

22:06

points for contrition and you

22:08

get reverse points for aggravating

22:10

factors. Yeah, I'm loathe to

22:12

sort of get too involved in this.

22:15

And that is certainly the case here

22:17

is what you mentioned, the mitigating factors.

22:19

One thing that Judge Lewis Kaplan noted

22:21

as a part of his explanation

22:24

for why such a stiff sentence. One,

22:26

he noted a lack of remorse. And

22:28

while he did say in a statement

22:31

to the court that he was sorry

22:33

about what had happened, he failed everyone.

22:36

I think the judge was making reference to

22:38

some of the events during the trial in

22:40

which there was very much

22:42

an attempt by his lawyers to suggest

22:44

that this was less than it was

22:46

and that he'd been doing all this

22:48

because he wanted to improve the world.

22:50

So there was the lack of remorse

22:52

side, but also he noted the risk

22:54

of future crimes. And that

22:57

probably was a comment on

22:59

what came to be not

23:01

as SBS lawyers said, honest

23:03

mistakes, but the very elaborate

23:05

systems that he had devised

23:07

to pull this off and to

23:10

disguise what he had done, even from

23:12

his fellow company members. And

23:14

this certainly left an impression on the

23:16

judge. So I'm not going to quibble

23:18

with the sentence either. And obviously a

23:21

lot of this in terms of what

23:23

he actually serves as you say, come

23:25

down to how he behaves himself in

23:27

prison. But I think

23:29

for the public, look, we tend to

23:31

get a lot more headlines about murders

23:33

and et cetera. But white collar crime

23:35

is a serious issue. It can damage

23:37

financially. A lot of people, while we're

23:39

hopeful a lot of these investors in

23:41

SBS will maybe get their money back. This

23:44

was certainly a major league scam. Alisha,

23:47

we'll give you the last word. But

23:49

my recollection is that some of the

23:51

people involved in cleaning up

23:53

this FTX mess were arguing that

23:55

this was kind of an old

23:57

fashioned crime and it has this

24:00

gloss on it from being a

24:02

cryptocurrency exchange, FTX, very high-tech. But

24:04

is that consistent with your read

24:06

of this, that what happened here

24:08

was not really related to the

24:11

fact that this was a crypto

24:13

business, and so not really a

24:15

reflection on cryptocurrency as an idea

24:17

or a technology or maybe even

24:19

a business going forward? Right. So

24:21

this was old-fashioned, basically, embezzlement. And

24:23

the fraud element is that he

24:26

continued to assure customers almost all

24:28

through the day that the FTX

24:30

collapsed, that their deposits were saved,

24:32

that they were on the exchange,

24:35

when in fact, again, he had

24:37

basically funneled them out to make

24:39

his own risky bets and use

24:41

it to enrich himself. This isn't

24:43

really related to crypto directly. The

24:45

Securities Exchange Commission, Gary Gensler, is

24:48

now trying to wave this around

24:50

and say, see, this is what

24:52

happens when you don't regulate crypto.

24:55

But it's not clear that Gary

24:57

Gensler needed any more powers to

24:59

actually go after old-fashioned securities fraud

25:01

or raise questions and investigate what

25:03

was going on. In fact, they

25:05

had already been investigating some other

25:07

crypto exchanges, Coinbase and cryptocurrency purveyors.

25:09

So it's not really clear when

25:11

there's old-fashioned fraud going on or

25:13

embezzlement, the government or DOJ can

25:15

step in. Thank you, Alicia and

25:18

Kim. Thank you all for listening.

25:20

You can email us at

25:22

pwpodcast at wsj.com.

25:25

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