Westly Ad Slams Angelides on Tax Hike Issue

The angry denunciations that have riven the Democratic contest for governor broke onto the television airwaves Friday night as state Controller Steve Westly started broadcasting an ad pounding rival Phil Angelides for supporting higher taxes.

Westly’s spot appeared to break his pledge not to be the first candidate in the June 6 primary to run an ad attacking his opponent by name. With the election just over three weeks away, Westly’s move was aimed at stopping Angelides, the state treasurer, from gaining a decisive edge in a race with no clear front-runner and a large bloc of undecided voters.

The ad also put the issue of tax increases at the forefront of the campaign. Both Democrats competing to challenge Gov. Arnold Schwarzenegger in November have a history of supporting higher taxes, but Westly has promised he would consider them only as a “last resort.”

The Republican governor, who has rejected calls to increase taxes, plans to make the topic a key point of contrast in the fall campaign no matter who wins the Democratic nomination.

On Friday, Angelides began airing a television ad promoting his call for higher taxes on corporations and the wealthy to raise money for schools. That position has long been a staple of his public remarks, but this is the first time that Angelides has raised the subject in television advertising, the primary tool for reaching California voters.

With the spat over taxes now fully engaged in the race for governor, a key question is how receptive Democratic primary voters will be to Westly’s argument that higher taxes for the middle class would be inevitable if Angelides won.

“When they hear all the taxes he’s proposed raising, Democratic voters lose their appetite for Phil pretty quickly,” Westly ad maker David Doak said.

Angelides is betting that the party’s liberal base will embrace his call to -- as he puts it -- take back nearly $5 billion in annual federal and state tax “giveaways” to those who need them the least and to steer the money to public schools.

“I’m one of those guys who would be paying a little more,” Angelides, a former real-estate developer, told supporters Thursday at a Langer’s deli breakfast in Los Angeles. “But the fact is that my family’s gotten the biggest tax breaks in history. I don’t need them.”

In Westly’s new ad, a narrator accuses Angelides of proposing $10 billion in tax increases, including “income taxes, sales taxes, corporate taxes, taxes on farm machinery, taxes on fuel, excise taxes, property taxes, and taxes on services.”

“With high gas prices, housing and healthcare costs, can working families afford Phil Angelides’ tax plan?” the narrator asks.

Angelides has supported raising each of those taxes in recent years. But in his campaign for governor, he has proposed only “closing corporate tax loopholes” and raising income taxes on Californians who make more than $500,000 a year.

Westly strategist Garry South said Angelides “doesn’t get the luxury now of trying to winnow it down and say, ‘Oh no, I’m only taxing millionaires and BP,’ ” the oil company.

Last month, Westly signed a pledge “not to be the first to initiate any paid advertising in this primary campaign that attacks the other by name” and challenged Angelides to do the same.

When asked how the new ad squares with that pledge, South said: “We pitched that proposal to Phil Angelides, and he didn’t bite.”

Angelides, he added, has attacked his rival “incessantly” for six weeks, including a Sacramento speech “ripping Steve Westly’s skin off.” And in a San Francisco debate this week, Angelides equated Westly “to Richard Nixon and Newt Gingrich -- in front of Steve’s wife,” South said.

Ads by both candidates have taken subtle jabs at each other, but Westly’s is the first to mention the opponent by name.

Senior Angelides advisor Bob Mulholland called the ad “completely false.”

“It looks like it’s the unraveling of the Westly campaign -- breaking a pledge to all reporters about a clean campaign, like Schwarzenegger broke his promises to the people of California,” Mulholland said. “Kind of a tragic end to the Westly campaign.”

Hours before the attack ad hit the air, Angelides pollster Paul Maslin said in an interview that Westly would undermine voter trust if he broke his pledge to stick to a positive ad campaign.

“The reaction to that will overwhelm everything,” Maslin said. “It’s just pure hypocrisy.”

With few distinctions between the two Democrats on issues, the hypocrisy accusation is part of a larger strategy by both Angelides and Westly to attack on matters of character. For Angelides, that has meant daily swipes at Westly for his close political ties to the governor at the height of Schwarzenegger’s popularity.

“In the last two years, Steve Westly’s had a lot of chances to stand up for hard-working families and school kids, and the only time he’s lifted a finger is to stick his finger in the political wind,” Angelides said Wednesday after the San Francisco debate.

Responding to Westly’s attack on taxes after the debate, Angelides said: “You can’t even count on him to be consistent on this issue. He called for an Internet sales tax. He’s supporting taxes for the preschool initiative.”

Like Angelides, Westly supports Proposition 82, the plan by filmmaker Rob Reiner to boost income taxes on Californians making more than $400,000 a year to raise money for free preschool for every 4-year-old in the state. Westly supported an Internet sales tax in the past, but has not proposed it in this race.

For his part, Westly has used his rival’s record as a Sacramento developer to symbolize what he portrays as hypocrisy by Angelides. He has seized mainly on the trouble that Angelides encountered with the U.S. Environmental Protection Agency during the 1980s in building tract homes outside Sacramento.

After the San Francisco debate, Westly mocked Angelides for touting his environmental credentials.

“I’m delighted he’s won some awards, but the fact remains that he’s been cited by the EPA for bulldozing wetlands,” Westly said. “He’s been cited by the EPA for violating the Clean Water Act. These are facts and public record.”

With the candidates gradually escalating their television ad battle, Angelides got another boost Friday from Sacramento developer Angelo Tsakapoulos, a longtime business partner, and the California Teachers Assn.

The builder and his daughter, Eleni Tsakopoulos-Kounalakis, added $1 million to the $5 million they have already spent on television advertising on behalf of Angelides, while the union kicked in $1 million. Such “independent expenditure” efforts fall outside the state’s campaign donation limits.

Carroll Wills, a spokesman for the committee funded by the Tsakapoulos family and the teachers union, said it would spend the $2 million to run a new television commercial for a week. It features a teacher, Sandra Fink, who starred in ads that unions ran last year against November ballot measures sponsored by Schwarzenegger.