Republican Senate Candidate a Proven Money-Raiser : Zschau Goes to Work on Overcoming Obscurity

House Republican leaders passed over a lot of big names recently before choosing Rep. Ed Zschau (R-Los Altos) to lead off the floor debate for President Reagan’s proposal to give military aid to the Nicaraguan contras .

The GOP leaders hoped Zschau, a recent convert to such aid, would sway House moderates. But for Zschau, the speech and the publicity it generated helped chip away at the two major obstacles to his quest for the Republican U.S. Senate nomination--the need to become better known and to appeal to conservatives whose support traditionally has been essential in state Republican primaries.

Even Zschau’s rivals concede that he has an engaging style, an impressive background and a reputation for carefully analyzing issues--all elements of a strong candidacy. He can also raise money. He raised $1 million last year and expects to add another $1 million by May 1.

But his obscurity as a two-term congressman from Northern California and his past votes against Reagan on the contras and MX missile issues have raised questions about whether he can attract broad support in the June 3 Republican primary.

The lack of statewide name recognition appears to be Zschau’s biggest obstacle, and it was evident at a recent gathering of several dozen farmers and businessmen in the San Joaquin Valley town of Merced.

“To be honest, I never heard of Ed Zschau until this week,” said John Pazin, who has an oil distributorship in Merced. Several others laughed and said Zschau was definitely a “new face.”

Zschau shed his suit jacket, rolled up his sleeves and took questions from the Merced group on trade policy, Central America, tax reform and trade deregulation.

Farmer and teacher Les McCabe was dubious when the session began, questioning Zschau’s preoccupation with aid for the contras at a time when California farmers are clamoring for relief from unfair trading practices by foreign competitors.

Zschau gave his “ag speech” calling for a free market (no price supports) in agriculture, combined with a tough U.S. trade policy that punishes unfair trading partners.

McCabe wrote out a $100 check and stuck it in Zschau’s pocket when the meeting broke up.

“I don’t have to agree with everything he says; I like the way he says it,” McCabe explained.

Almond farmer Arlan Thomas said he had never heard of Zschau before the meeting but walked away impressed, especially with Zschau’s call for an end to price supports, which Thomas believes weaken California farming operations.

Support Expected

John Hix and Lynn Joyner, Zschau’s consultants in the San Joaquin Valley, boast that their candidate will soon begin to attract major support in the valley. But the key to their strategy is personal appearances by Zschau himself--and that is hard to arrange as Zschau concentrates on vote-rich Southern California.

At Hix’s urging, the Zschau campaign recently made a videotape that can be played at fund-raisers in various farming communities.

“Our strategy is to introduce Ed to as many influential valley people as we can,” Hix said. “When he begins to pick up momentum later, it will be the ‘in thing’ up here to be for Ed Zschau.”

In Southern California, curiosity about Zschau recently drew about 75 business executives and millionaires to a dining room at Westwood’s exclusive Regency Club.

Many in the crowd had been telephoned by their friend Joyce Valdez--who raises money for Vice President Bush and California Sen. Pete Wilson--and told to “bring your checkbooks and come have lunch with Ed Zschau.”

Several of them admitted privately that their first reaction was, “Ed who?”

Major Contributors

Seated at the head table for the lunch were some of the Republican Party’s major contributors, including Armand Deutsch, friend of the Reagans and an heir to the Sears, Roebuck fortune; Margaret Brock, friend of the President and patron to dozens of young Republican politicians; Rocco Siciliano, friend of the President and consultant to Ticor Insurance; Thomas V. Jones, chairman of Northrop Corp.; Rodney W. Rood, vice president emeritus of Arco; Roy L. Ash, investment banker and head of the Office of Management and Budget under President Richard M. Nixon; and Julian A. Virtue, businessman and longtime fund-raiser for various Republican candidates.

“I’m here to let you kick the tires,” Zschau told the group. “I’m here to make sure you can pronounce my name (it sounds like ‘shout’ without the ‘t’).”

Testimonials Offered

Some of those at the head table are not committed to any candidate in the Senate race. But Rood and Siciliano are on board with Zschau and they stood up to offer testimonials.

“I just wish I could convey to you the impact Ed Zschau has had on me,” Siciliano said.

Rood said, “I’m going all out for Ed Zschau.”

Valdez, who has signed a contract to raise money for Zschau, said, “I’ll bat cleanup: Alan Cranston (the Democratic incumbent senator) has never had a tough race. Ed Zschau can beat him.”

In his remarks, Zschau made a point of mentioning that the next morning he would give the opening speech in support of Reagan’s contras plan. He also talked about cutting capital gains taxes to promote economic growth, and he saw a lot of smiles when he said, “We need more business people in government.”

Deutsch turned to venture capitalist Kip Hagopian, chairman of Zschau’s steering committee, and said, “I’ll sell a table for your dinner.”

A table for Zschau’s Los Angeles dinner on April 22 costs $10,000, or $1,000 per plate.

“I don’t usually have that big a dinner ticket in this situation, where the candidate still isn’t all that well known,” Valdez said. “But I figured, what the hell, let’s go for broke. Five hundred people and you’ve got $500,000.”

TV Commercials Planned

Zschau says he will spend most of the $4 million he hopes to raise in the primary on television commercials.

At the Regency Club lunch, Zschau campaign manager Ron Smith showed the group the candidate’s first television ads, and then patted the TV set and said, “We will win the Republican primary with this box.”

The first Zschau television ads, which ran early this month, provided a quick biography--he was a champion ice skater as a youth in Nebraska, he taught at the Stanford School of Business, and he founded a high-technology business before going to Congress in 1982. Future ads will also deal with issues.

Zschau is a clean-cut type with a falcon’s stare that bores in on those he engages in conversation. His strategists tell him his strength is his sincerity, his ability to inspire small groups of people with such statements as “We can be the best” and “One person can make a difference.”

Pazin, the businessman at the Merced meeting, agrees with the strategists.

“I have a feeling that this kind of thing, where you get to be around him, is his strong point,” Pazin said. “But you can’t reach enough people like this to win an election. So I guess he’s got to go on TV.”