Fitrakis & Wasserman: Diebold's Political Machine

Soccer moms and NASCAR dads come and go, but swing states are always in fashion. And this year, Ohio is emerging as the most fashionable of the bunch. Asked recently about the importance of Ohio in this year's presidential campaign, one veteran of Buckeye State politics told Salon, "Ohio is the Florida of 2004."

That label sounds ominously accurate to the many who are skeptical of computerized voting. In addition to being as decisive as the 2000 polling in Florida, they worry this year's vote in Ohio could be just as flawed. Specifically, they worry that it could be rigged. And they wonder why state officials seem so unconcerned by the fact that the two companies in line to sell touch-screen voting machines to Ohio have deep and continuing ties to the Republican Party. Those companies, Ohio's own Diebold Election Systems and Election Systems & Software of Nebraska, are lobbying fiercely ahead of a public hearing on the matter in Columbus next week.

There's solid reason behind the political rhetoric tapping Ohio as a key battleground. No Republican has ever captured the White House without carrying Ohio, and only John Kennedy managed the feat for the Democrats. In 2000, George W. Bush won in the Buckeye State by a scant four percentage points. Four years earlier, Bill Clinton won in Ohio by a similar margin.

In recent years, central Ohio has been transformed from a bastion of Republicanism into a Democratic stronghold. Six of Columbus' seven city council members are Democrats, as is the city's mayor, Michael Coleman. But no Democrat has been elected to Congress from central Ohio in more than 20 years, and the area around Columbus still includes pockets where no Democrat stands a chance. One such Republican pocket is Upper Arlington, the Columbus suburb that is home to Walden "Wally" O'Dell, the chairman of the board and chief executive of Diebold. For years, O'Dell has given generously to Republican candidates. Last September, he held a packed $1,000-per-head GOP fundraiser at his 10,800-square-foot mansion. He has been feted as a guest at President Bush's Texas ranch, joining a cadre of "Pioneers and Rangers" who have pledged to raise more than $100,000 for the Bush reelection campaign. Most memorably, O'Dell last fall penned a letter pledging his commitment "to helping Ohio deliver its electoral votes to the President."

O'Dell has defended his actions, telling the Cleveland Plain Dealer "I'm not doing anything wrong or complicated." But he also promised to lower his political profile and "try to be more sensitive." But the Diebold boss' partisan cards are squarely on the table. And, when it comes to the Diebold board room, O'Dell is hardly alone in his generous support of the GOP. One of the longest-serving Diebold directors is W.R. "Tim" Timken. Like O'Dell, Timken is a Republican loyalist and a major contributor to GOP candidates. Since 1991 the Timken Company and members of the Timken family have contributed more than a million dollars to the Republican Party and to GOP presidential candidates such as George W. Bush. Between 2000 and 2002 alone, Timken's Canton-based bearing and steel company gave more than $350,000 to Republican causes, while Timken himself gave more than $120,000. This year, he is one of George W. Bush's campaign Pioneers, and has already pulled in more than $350,000 for the president's reelection bid.

While Diebold has received the most attention, it actually isn't the biggest maker of computerized election machines. That honor goes to Omaha-based ES&S, and its Republican roots may be even stronger than Diebold's.

The firm, which is privately held, began as a company called Data Mark, which was founded in the early 1980s by Bob and Todd Urosevich. In 1984, brothers William and Robert Ahmanson bought a 68 percent stake in Data Mark, and changed the company's name to American Information Services (AIS). Then, in 1987, McCarthy & Co, an Omaha investment group, acquired a minority share in AIS.

In 1992, investment banker Chuck Hagel, president of McCarthy & Co, became chairman of AIS. Hagel, who had been touted as a possible Senate candidate in 1993, was again on the list of likely GOP contenders heading into the 1996 contest. In January of 1995, while still chairman of ES&S, Hagel told the Omaha World-Herald that he would likely make a decision by mid-March of 1995. On March 15, according to a letter provided by Hagel's Senate staff, he resigned from the AIS board, noting that he intended to announce his candidacy. A few days later, he did just that.

A little less than eight months after steppind down as director of AIS, Hagel surprised national pundits and defied early polls by defeating Benjamin Nelson, the state's popular former governor. It was Hagel's first try for public office. Nebraska elections officials told The Hill that machines made by AIS probably tallied 85 percent of the votes cast in the 1996 vote, although Nelson never drew attention to the connection. Hagel won again in 2002, by a far healthier margin. That vote is still angrily disputed by Hagel's Democratic opponent, Charlie Matulka, who did try to make Hagel's ties to ES&S an issue in the race and who asked that state elections officials conduct a hand recount of the vote. That request was rebuffed, because Hagel's margin of victory was so large.

As might be expected, Hagel has been generously supported by his investment partners at McCarthy & Co. -- since he first ran, Hagel has received about $15,000 in campaign contributions from McCarthy & Co. executives. And Hagel still owns more than $1 million in stock in McCarthy & Co., which still owns a quarter of ES&S.

If the Republican ties at Diebold and ES&S aren't enough to cause concern, argues election reform activist Bev Harris, the companies' past performances and current practices should be. Harris is author of Black Box Voting, and the woman behind the BlackBoxVoting.com web site.

The rush to embrace computerized voting, of course, began with Florida. But, in fact, one of the Sunshine State's election-day disasters was the direct result of a malfunctioning computerized voting system; a system built by Diebold. The massive screwup in Volusia County was all but lost in all the furor over hanging chads and butterfly ballots in South Florida. In part that's because county election officials avoided a total disaster by quickly conducting a hand recount of the more than 184,000 paper ballots used to feed the computerized system. But the huge computer miscount led several networks to incorrectly call the race for Bush.

The first signs that the Diebold-made system in Volusia County was malfunctioning came early on election night, when the central ballot-counting computer showed a Socialist Party candidate receiving more than 9,000 votes and Vice President Al Gore getting minus 19,000. Another 4,000 votes poured into the plus column for Bush that didn't belong there. Taken together, the massive swing seemed to indicate that Bush, not Gore, had won Florida and thus the White House. Election officials restarted the machine, and expressed confidence in the eventual results, which showed Gore beating Bush by 97,063 votes to 82,214. After the recount, Gore picked up 250 votes, while Bush picked up 154. But the erroneous numbers had already been sent to the media.

Harris has posted a series of internal Diebold memos relating to the Volusia County miscount on her website, blackboxvoting.com. One memo from Lana Hires of Global Election Systems, now part of Diebold, complains, "I need some answers! Our department is being audited by the County. I have been waiting for someone to give me an explanation as to why Precinct 216 gave Al Gore a minus 16,022 [votes] when it was uploaded." Another, from Talbot Ireland, Senior VP of Research and Development for Diebold, refers to key "replacement" votes in Volusia County as "unauthorized."

Harris has also posted a post-mortem by CBS detailing how the network managed to call Volusia County for Bush early in the morning. The report states: "Had it not been for these [computer] errors, the CBS News call for Bush at 2:17:52 AM would not have been made." As Harris notes, the 20,000-vote error shifted the momentum of the news reporting and nearly led Gore to concede.

What's particularly troubling, Harris says, is that the errors were caught only because an alert poll monitor noticed Gore's vote count going down through the evening, which of course is impossible. Diebold blamed the bizarre swing on a "faulty memory chip," which Harris claims is simply not credible. The whole episode, she contends, could easily have been consciously programmed by someone with a partisan agenda. Such claims might seem far-fetched, were it not for the fact that a cadre of computer scientists showed a year ago that the software running Diebold's new machines can be hacked with relative ease.

The hackers posted some 13,000 pages of internal documents on various web sites ­ documents that were pounced on by Harris and others. A desperate Diebold went to court to stop this "wholesale reproduction" of company material. By November of last year, the Associated Press reported that Diebold had sent cease-and-desist letters to programmers and students at two dozen universities, including the University of California at Berkeley and the Massachusetts Institute of Technology. The letters were ignored by at least one group of students at Swarthmore College, who vowed an "electronic civil disobedience" campaign.

Equally troubling, of course, is the fact that the touch-screen systems Diebold, ES&S, and the other companies have on the market now aren¹t designed to generate a polling place paper trail. While ES&S says it is open to providing voter receipts, and has even designed a prototype machine that does so, the company isn¹t going to roll that prototype into production until state and federal elections officials make it mandatory.

Lawmakers in Congress and the Ohio legislature are scrambling to do just that. In Ohio, State Sen. Teresa Fedor of Toledo has proposed a bill requiring a "voter verified paper audit trail" for all elections in the state. Congressman Rush Holt of New Jersey is pushing a similar measure in Washington. But the efforts are being fought by Republicans in both places. In Ohio, Secretary of State Kenneth Blackwell has already signed $100 million in agreements to purchase voting machines. The bulk of the purchases would go to Diebold and ES&S, and Blackwell insists there is no need for paper receipts. Considering the political opposition and the companies¹ wait-and-see approach, it¹s almost certain that voters using touch-screen machines in November will walk away from their polling places without ever seeing a printed record of their choices.

At a trade fair held recently here in Columbus, a wide range of companies seeking to fill that void demonstrated technologies that could easily and cheaply provide paper receipts for ballots. One such product, called TruVote, provides two separate voting receipts. The first is shown under plexiglass, and displays the choices made by a vote on the touch screen. This copy falls into a lockbox after the voter approves it. The second is provided to the voter. TruVote is already attracting fans, among them Brooks Thomas, Tennessee's Coordinator of Elections. "I've not seen anything that compares to [the] TruVote validation system." Georgia's Assistant Secretary of State, Terrell L. Slayton, Jr., calls the device is the "perfect solution." But Blackwell argues the campaign for a paper ballot trail for Ohio is an attempt to "derail" reform. He says he'll comply with the demand only if Congress mandates it.

Meanwhile, in Upper Arlington, a Œlower profile' Wally O'Dell and his wife recently petitioned the city to get permission to serve liquor at future fundraisers and political gatherings. What do you think?

Correction -- An earlier version of this commentary incorrectly described the terms of Sen. Chuck Hagel's relationship with ES&S, and what he disclosed to election officials concerning that relationship. In forms submitted to the Nebraska Secretary of the Senate in 1996, Hagel disclosed both that he had been chairman of American Information Systems Inc. (AIS), a forerunner of ES&S, and had financial holdings in the McCarthy & Co. investment group, which held a minority interest in AIS.

Bob Fitrakis is editor, and Harvey Wasserman is senior editor, of the Columbus Free Press. They are co-authors of 'George W. Bush Versus the Superpower of Peace.'

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