[progchat_action] Arnold's Re-election Campaign Broke
 
Date: Fri, 3 Feb 2006 01:03:47 -0600 (CST)

(After a humiliating defeat to labor led forces in a special election,
California Governor Schwarzenegger  appears to be damaged goods, his
campaign war chest is empty. By contrast, the Dem candidates appear to be
well funded. Given the size of the Dems campaign  coffers it is safe to say
that they aren't relying on nickels and dimes from the grass roots.  With
Schwarzenegger's luster now faded, the corporate donors may well be
nostalgic for the new dems such as the ousted Gray Davis. SR)

With re-election bid ahead, governor's cupboard is bare

By Kevin Yamamura and Andy Furillo -- Bee Capitol Bureau
Published 2:15 am PST Wednesday, February 1, 2006
Story appeared on Page A1 of The Bee

After a special election with a price tag that topped $275 million, Gov.
Arnold Schwarzenegger's personal war chest is virtually empty as he begins
his 2006 re-election campaign, according to reports filed Tuesday with the
secretary of state. Schwarzenegger's ballot initiative committee alone
exhausted $45.5 million during last year's special election campaign in
which voters rejected eight ballot proposals, including four specifically
backed by the governor.

With all the large campaign committees reporting, opponents of the governor
spent about $121 million to defeat those four initiatives, while
Schwarzenegger and his allies fought the battle with $76 million of their
own. The Republican governor also raised $2.5 million for his personal
re-election campaign, but he spent $3 million on everyday expenses and
supporting his initiative drive.

That left Schwarzenegger with $147,000 in cash and $556,000 in debt in his
campaign account as of Dec. 31. Much of that debt - $336,000 - was owed to
his personal holding company, Oak Productions, for travel, lodging and
meals.

"Obviously, we have a lot of fundraising to do, and we've begun that in
earnest this month," said Schwarzenegger fundraiser Marty Wilson. "We're
getting a good response. I feel confident we'll have the resources necessary
to wage an aggressive campaign in the fall."

The governor's lack of a competitive primary likely leaves enough time to
refill his coffers before the November general election, but his potential
Democratic opponents won't have that same luxury.

Heading into an expensive and potentially bruising Democratic gubernatorial
primary in June, state Treasurer Phil Angelides reported Tuesday he had $17
million in cash in his account as of Jan. 31.

State Controller Steve Westly, Angelides' Democratic rival, announced last
month that he has $24 million - $20 million of which came from Westly
himself. He has a $7 million cash edge and last week purchased the
campaign's first television ads in the Chico and Redding market.

Angelides' campaign was quick to criticize the fact that more than
four-fifths of Westly's funds came from his personal bank account.

"The difference is that Westly is almost completely self-funded, while Phil
Angelides has the support of 21,000 people," said Angelides spokesman Brian
Brokaw.

Campaigning Tuesday in Chico, Westly defended his personal contribution as a
way to ignore interest groups, much as previous self-financed candidates
have. "I'm very proud I've been able to put some of my own money in, partly
because it's a statement that you're not dependent on special interests,"
Westly said. "It also shows that I believe in myself and what I'm doing."

Brokaw said Angelides has not invested in his own campaign. But he added
that Angelides is prepared to do "what it takes to win."

Schwarzenegger's campaign committee, his opponents in organized labor and
the nation's largest drug companies fueled the political spending frenzy in
last year's special election that exceeded $270 million, according to
campaign finance reports filed Tuesday.

The governor's California Recovery Team spent $45.5 million on the election,
only to see the public shoot down the four key initiatives the governor
supported.

Propositions 74 through 77 would have extended public school teachers'
probationary periods, made it tougher for public employee unions to raise
campaign money from their members, given the governor more authority to cut
state spending and taken redistricting power away from the Legislature.

"As successful as we were in fundraising, the other side was more
successful, probably to the tune of two and a half times," Wilson said. "It
was a crushing amount of money spent against us, and obviously it had a
negative impact."

The labor-Democrat committee that thwarted the Schwarzenegger initiatives,
the Alliance for a Better California, was largely funded by public employee
unions. Leading the way for the labor groups was the California Teachers
Association, which spent $58.5 million.

"We obviously feel that the money spent on the special election was
justified, although we wish the special election hadn't been called in the
first place, since voters didn't want it," said California Teachers
Association spokeswoman Sandra Jackson. "But since it was called, we felt
whatever it would take to defeat the initiative is what we would spend, and
our members did agree with that, and we were successful. It was money
well-spent."

The biggest spender in the special election campaign was Pharmaceutical
Research and Manufacturers of America, which put out $83.6 million to stop
consumer groups from imposing tough prescription drug cost controls in one
initiative. Another measure aimed at reducing drug costs for the poor that
was favored by the pharmaceutical firms also went down to defeat.

"It was a very difficult election with all the issues on the ballot, and we
had to crack through and separate out all the issues for the voters," said
Frank Schubert, the strategist who helped direct the drug companies'
campaign.

Opponents of a defeated plan to require parental notification before minors
undergo abortions outspent their foes on Proposition 73, $5.6 million to
$1.9 million, while opponents of energy re-regulation spent $2.6 million to
beat Proposition 80; supporters spent a little over half a million,
according to the incomplete tallies from the secretary of state's office.

Bob Stern of the Los Angeles-based Center for Governmental Studies said the
spending in the special election campaigns appeared to have set a record for
the state for ballot measures.

"It's too bad, in a sense, that people feel they have to spend all the
money, that they feel they can't get their message out through the free
media," Stern said. "But that's the way it is, and what it does is let
groups with money set the agenda. That's the unfortunate part. A group
without money really can't participate."

http://www.sacbee.com/content/politics/story/14139330p-14968068c.html

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