Contributors buying political influence despite recall rhetoric

SACRAMENTO (AP) -- When he announced for governor, Arnold Schwarzenegger said he is so rich he would refuse campaign contributions from special interests he blamed for causing gridlock in state government.

Later, he amended that to mean no money from interests he would oversee as governor, such as state unions and Indian tribes that want to build casinos.

But Schwarzenegger is getting millions from other special interests, while tribes, unions and others provide the financial base for Schwarzenegger's major rivals, Democrats Lt. Gov. Cruz Bustamante and Gov. Gray Davis, the target of the Oct. 7 recall election.

For all the novelty of California's recall election, and despite recall backers' hopes of shaking up business-as-usual in Sacramento, campaign contribution records show the typical deep-pocketed contributors are choosing sides.

"If there's going to be a new governor, every special interest in the state is going to be sure they're looked at as valued allies of whoever's elected," said Larry Makinson, a senior fellow at the Center for Responsive Politics in Washington, D.C.

The usual suspects are joined by others with more immediate interests in how business is done in Sacramento.

Insurance and health care providers have been battling over the state's workers' compensation system and they've given heavily to Davis, who says he'll sign compromise legislation.

Developers funneled money to Davis as lawmakers debated sending him legislation on low-income housing, brownfields cleanup and residential development land. Agriculture and timber interests are contributing while he eyes air quality, timber harvesting and farmworker bills.

Political and legal opposition to the $3.8 million Bustamante accepted from gambling tribes forced him to use the money for television ads opposing Proposition 54, which would limit government's collection of racial data.

But Bustamante also is accepting nearly $50,000 from Los Angeles-based Cordoba Corp. and Telacu Industries Inc. Both have a history of using support from Hispanic leaders to land public contracts, and subsequently facing criticism of how those contracts are handled.

Schwarzenegger, despite eschewing contributions from tribes and unions, is taking hundreds of thousands of dollars each from agriculture interests, developers, financial service providers, the high-tech industry, state contractors and others with pending legislation and other interests he would influence if he is elected governor.

One of the most generous contributors to Schwarzenegger's campaign this year and his Proposition 49 after-school initiative last year is Diversified Collection Service Inc., which collects defaulted college loans and is lobbying to help collect overdue federal income taxes.

Diversified and its CEO, James Tracey, are longtime Republican donors. The company is under investigation for violating a Texas prohibition on corporate donations, after giving $50,000 through House Majority Leader Tom DeLay's Texans for a Republican Majority toward a successful effort to win GOP control of the Texas House.

Company officials did not return telephone messages Thursday from The Associated Press, and Schwarzenegger spokesman Rob Stutzman said he was unfamiliar with the company.

"There's no question the special interests are lining up behind the Democrats, as usual," Stutzman said. But Republican interests back Schwarzenegger, he said, because of his promise to create a better business climate because "job creators are attracted to that message."

Parker Blackman, spokesman for independent candidate Arianna Huffington, said Schwarzenegger "has decided to split hairs between special interests and powerful interests. I don't know how you make that distinction. They obviously expect something in return."

Huffington has focused her campaign on the theory that while voters are mad at Davis, "people are also outraged at business-as-usual, at special interests controlling Sacramento," in Blackman's words.

But Huffington trails far behind Schwarzenegger in fund-raising and opinion polls. Many of her largest contributors are entertainers and Hollywood executives, who also have an array of legislative interests.

"It takes more than grass roots support in a state this large to get your message out," said Saskia Mills, executive director of the California Voter Foundation.

She sees genuine grass roots excitement about the recall, both in support and opposition, while Davis consultant Roger Salazar argues that buzz has been artificially created by big money.

Ted Costa, one of the sponsors of the recall initiative, said special interests always have influence: "I just don't want to see them controlling everything."

Teachers, trial lawyers, prison guards and many corporate interests have yet to weigh in, perhaps fearful of backing a loser or intending to spend their money on independent campaigns for or against the recall in the final two weeks, noted Jim Knox, executive director of California Common Cause.

When it comes to special interest contributions, Knox said, "the only thing that surprises me is we haven't seen more of it."


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