Arbitration ≠ Fairness

Arbitration is a low-cost, fair way of settling disputes without involving lawyers and coruts, right? Wrong, according to an NPR report last week. An analysis of 34,000 California cases showed consumers losing 94% of the time. The National Arbitration Forum (NAF), a large arbitration firm, says the number is too high, but that corporations are likely to win most of the time because they won’t go to arbitration unless they have a good case. Consumers, apparently, are too stupid to understand when they have a bad case. Or maybe, since consumers have such deep pockets, they simply don’t care that they are wasting time and money on arbitration.

Arbitration, mediation, conflict resolution – they all sound like ways to minimize conflict and get results that are fair and better for both parties. That’s not what happens. In the real world, power and wealth too often tip the scales. A Harvard law professor reports that her part-time arbitration career with NAF ended after her 20 cases. On the first 19, she ruled for the company. On the twentieth, she awarded the consumer $20,000. She never got assigned another case.

Why does this matter? NPR says, “If you use credit cards, have a cell phone contract, bought a house from a builder or put your mother or father in a nursing home, you have very likely signed away your right to be heard in court if there’s a problem.” Arbitration clauses are in the fine print of many, perhaps most, consumer contracts. Employment contracts often have arbitration clauses, too.

As a former attorney, I have no illusions about the difficulty of using the court system — costs a lot, takes a long time, and there’s a huge advantage for the party who has more money for lawyers and court costs, etc. But arbitration is clearly no panacea, and arbitration clauses that forbid you from going to court are bad policy.

Wisconsin Senator Russ Feingold has introduced the Arbitration Fairness Act, which would prohibit pre-dispute mandatory arbitration clauses in consumer contracts. The legislation would not prevent or prohibit arbitration, but it would give consumers the right to go to court instead of submitting to a privatized justice system.

What with bank bailouts and automobile bankruptcies and all that, it’s flying below most people’s radar. Might be worth a call to your congressional rep, to let them know you think they should take it seriously.

For more info, see Fair Arbitration NOW, Houston law professor Richard M. Alderman, the National Employment Lawyers Association

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News Day: MN economy’s “gruesome bookends” / IRV or RCV – now legal in MN / Iran elections today / more

MN economy’s “gruesome bookends” Steve Perry writes in MinnPost that Minnesota’s dwindling unemployment insurance fund and tax revenues tied increasingly to the business cycle offer two troubling “bookends” of evidence that the state’s fiscal troubles will continue far into the future. On the UI front, Minnesota has less than two months of reserves, with a year considered healthy, and is expected to join the ranks of states borrowing from the feds to pay unemployment benefits, and running up a debt that will further complicate future budgets.

On the tax side, Perry cites a complex analysis offered by state economist Tom Stinson in a PIM interview with Perry, which explains in greater depth what Perry summarizes for MinnPost as:

To make a long story short, and somewhat over-simple: Through-the-roof revenues from capital gains and bonus income during the bubble years both distorted and inflated state revenues, and led states to cut taxes and expand spending in unsustainable ways.

The PIM interview includes some Stinson recommendations about needed changes in the tax structure, including raising some taxes, changes in capital gains tax treatment, and much more. From a journalistic point of view, it’s somewhat amusing to see Perry in MinnPost referencing and simplifying Perry in PIM. I’m glad he did, as the PIM article is both important and tough reading. Its conclusion: Minnesota tax revenues will not return to pre-recession levels until 2014.

IRV is in The MN Supreme Court ruled that Instant Run-off Voting, aka Ranked Choice Voting, is legal and constitutional and Minneapolis can go ahead and use the choice already approved by voters a couple of years ago. Opponents say they will keep on suing, in other cities that adopt IRV, and probably also in challenges to results of elections using IRV. They don’t really care what the voters say, or what the Supreme Court says. Their lawsuits just increase the costs of IRV for every city that adopts it. The St. Paul City Council is expected to consider IRV now, having delayed consideration to see what the Supreme Court would say.

The FairVote Minnesota press release explains the process:

RCV is a tested, accepted and implementable system by which voters rank candidates in order of preference, ensuring majority winners in single-winner races where there are more than two candidates on the ballot. Under RCV, voters cast their vote for their favorite candidate knowing that if he or she doesn’t gather enough votes to be one of the top two finishers, their votes will count toward their second choice. Votes cast for the least popular candidate are not “wasted”, but rather redistributed to more popular candidates, based on the voters’ second choices, until one candidate emerges with a majority of votes. In multi-winner elections, like the Minneapolis Park Board RCV ensures majority rule while empowering small groups of voters with greater opportunity to elect a candidate that represents them.

Politics in Minnesota explains the expected political impacts of IRV:

Since, of course, the DFL dominates Minneapolis politics, this could let marginalized urban conservatives and independents efficiently consolidate their votes around more conservative candidates. On the other hand, it also frees those to the left of the DFL mainstream to vote for Greens and other lefties, and then safely set a second choice for a liberal DFLer.

You can’t get there from here Stretches of I-94 and I-35W in the heart of the metro area will be closed this weekend. The Strib summary: “All northbound lanes on 35W will be closed from Crosstown Hwy. 62 to 94; all of 35W’s southbound lanes will be closed from S. 60th Street to the crosstown (which will remain open). Westbound lanes of 94 will be closed between 35W and Hwy. 280; access from the Cretin-Vandalia exit in St. Paul will be blocked.”

Minneapolis Police Department layoffs No police officers get the ax, but 17 community service officers will be laid off, a consequence of less-than-expected federal stimulus funding, reports the Strib. In February, Mayor RT Rybak thought the city would get $5 million for police — the actual figure is now down to $3.73 million.

World/National Headlines

Worth-less The personal wealth of Americans dropped by $1.3 trillion in the first quarter of 2009, pushing back to 2004 levels, reports AP. The 2.6 percent decline, mostly in the value of homes and stocks, came on top of earlier losses during 2007-08. On the other hand, “Americans’ personal savings rate zoomed to 5.7 percent in April, the highest since 1995.”

Peru protests move to Lima About 20,000 marched on Congress, amid clouds of tear gas, reports BBC, protesting last week’s violence against indigenous people blocking roads in the Amazon region and protesting against oil and gas drilling.

Confrontations between police and indigenous protesters last week led to the deaths of more than 50 people.

Congress in Lima voted on Wednesday to suspend two controversial land decrees.

Aung San Suu Kyi BBC reports that the trial of Nobel Peace Prize winner Aung San Suu Kyi has been continued to June 26. Suu Kyi has been under house arrest for most of the past 19 years, but her house arrest was scheduled to end in May. Instead, a bizaare incident involving an American who swam a lake to enter her home uninvited led to the government charging Suu Kyi with violating the terms of her house arrest. According to BBC, “Observers believe that Burma’s military leaders will seize on the incident to keep her behind bars during what they say will be multi-party elections in 2010.”

Iran elections today Huge turnouts are reported in today’s presidential elections in Iran, where President Mahmoud Ahmadinejad faces a strong challenge from the more moderate former prime minister Mir Hossein Mousavi, after an intense campaign in which the economy was a major issue. Two other candidates are also on the ballot. BBC notes that:

Iran is ruled under a system known as Velayat-e Faqih, or “Rule by the Supreme Jurist”, who is currently Ayatollah Ali Khamenei….

But the constitution also stipulates that the people are the source of power and the country holds phased presidential and parliamentary elections every four years.

War Reports

Pakistan A senior Islamic cleric was killed in Lahore, reports BBC. The suicide bomber attacked Sarfraz Naeemi at the Jaamia Naeemia madrassa around the time of Friday prayers. Naeemi had denounced the Taliban as “un-Islamic” and also denounced suicide bombing

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News Day: St. Paul teacher layoffs / Court to Coleman: Pay up / Fletcher vs. Auditor / Taking weather out of MN / more

St. Paul teacher layoffs St. Paul is laying off 143 teachers, reports the Strib, with “116 non-tenured teachers let go for budget reasons, 26 non-tenured teachers let go for performance reasons, and one tenured teacher let go for budget reasons.” The district faces a $25 million deficit next year, and firing the teachers could save $6 million. St. Paul has about 3,500 teachers, and has laid off about 37 each year in the past.
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News Day: Pawlenty: Layoffs coming / Misleading Strib headline / Peach-glazed pig cheeks / Tweeting the revolution / Karen fleeing / more

Pawlenty: Layoffs coming Gov. Tim Pawlenty said Tuesday that he will announce state spending cuts within two weeks, reports the PiPress, and the cuts will mean layoffs for some state employees. The governor also plans to use “budget shifts” to delay state payments to public schools. Pawlenty vetoed budget plans sent to him by the state legislature, leaving a $2.7 billion shortfall in the two-year state budget that takes effect July 1, and leaving him with the authority to make unilateral “unallotments” to balance the budget.
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News Day: What now, Norm? / Death in Somalia: Looking for answers / Carstarphen: Go slower / Wind industry layoffs / more

What now, Norm? Politics in Minnesota has gotten several answers to that question over the past few days. First, on June 4, came a report from Roll Call that Norm was willing to bow out if the MN Supreme Court rules against him. PIM thought that sounded unlikely, and, within hours, posted:
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News Day: Going up – domestic violence, tick populations / Going down: Auto dealers, Gang Strike Force / “Stagecoach from hell” / Tweet trouble / more

Domestic violence increase “off the charts” Looking at domestic violence, St. Paul police see an “an uptick off the charts,” and Dakota County’s Community Action Council reported a 37 percent increase in women seeking services for domestic abuse from 2007 to 2008, reports the PiPress. The increase in domestic violence is attributed, at least in part, to the economic recession.
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News Day: Unemployment up, benefits down / Central Corridor challenge / Food fights and skateboards / more

help!need moneyUnemployment up to 9.4 percent Seasonally adjusted unemployment rose to 9.4 percent in May, up from 8.9 percent in April, according to the U.S. Bureau of Labor Statistics. The “U-6” number, which includes discouraged workers and those working part-time because they can’t find full-time work rose to 16.4 percent, up from 15.8 percent in April. Comparable numbers for 2008 were 5.2 percent seasonally adjusted unemployment and 9.4 percent, including discouraged workers and part-time workers.
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News Day: Obama in Cairo / Nuyorican St. Paul music / Call to killing / Scared of single payer / H1N1 in MN / Doctor didn’t have to die / more

obama official photoCouldn’t get to Cairo? Not to worry. If the medium is the message, then in this instance the speaker was the message, as the NYT concluded, “it boiled down to simply this: Barack Hussein Obama was standing at the podium as the American president.” Full text of the speech here, and the BBC has a generous video segment.

One soundbite:

I consider it part of my responsibility, as president of the United States to fight against negative stereotypes of Islam wherever they appear. But that same principle must apply to Muslim perceptions of America. Just as Muslims do not fit a crude stereotype, America is not the crude stereotype of a self-interested empire.

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Couldn’t get to Cairo? Not to worry.

obama official photoThe White House sent out the prepared text of President Obama’s speech (read it after the jump), and BBC has a generous video segment. If the medium is the message, then in this instance the speaker was the message, as the NYT concluded, “it boiled down to simply this: Barack Hussein Obama was standing at the podium as the American president.”

One soundbite:

I consider it part of my responsibility, as president of the United States to fight against negative stereotypes of Islam wherever they appear. But that same principle must apply to Muslim perceptions of America. Just as Muslims do not fit a crude stereotype, America is not the crude stereotype of a self-interested empire.

Text of the speech after the jump.
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News Day: All T-Paw, all the time / Vampire pleads guilty / Trees coming down / Recession-proof industry / more

T-Paw signing off – in 2010 As Governor Pawlenty announced that he would not run for a third term as governor in 2010, it seemed that no other news could compete. Here’s the breakdown from Eric Black, who came away from the press conference with the message that “Tim Pawlenty loves God, his wife and kids, the troops and Minnesotans”, as well as the news that House Minority Leader Marty Seifert will run for guv, the PiPress gives a straightforward report,PIM looks at Pawlenty as a Big Mac, with “Secret sauce, secret seasonings. Same thing. Extraordinary tastes for extraordinary times,” but also provides a fact check on T-Paw’s claims of success, MinnPost on possible GOP gubernatorial candidates, and the Strib.
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