The yoke on this game utilizes two Angle Encoders. The encoder wheel provides an absolute position of the controller based on rotation angle from the base line. Most steering wheel controller simply send pulses to indicate the wheel was turned left or right. These controls do not mark the absolute position.

The Midway Angle Encoder marks the position. It does this well until the wheel inside the encoder gets dirty or the pins get worn. Then it send intermittent signals and the game board gets confused. Hopefully it is a dirty wheel that you can clean.

You have to remove the angle encoder from the controller. Then you have to desolder the gray, plastic wheel housing from the encoder PCB. The next part is the scary step. The plastic housing is 3 layers sandwiched together with some clips and plastic pins. The layers must be forced apart by removing the clips and prying the plastic pins open. This is always dangerous with 30+ year old plastic.

When the wheel drops out of the housing, clean it with rubber erasers or rubbing alcohol.

Place the wheel on the bottom slice of the sandwich, drop the middle slice on it, place the axle through the hole and engage the wheel. Now drop the third slice and clip it back together.

Solder it back on the board and replace the Encoder unit.