Tobacco Lobby’s Unlikely Foe : GOP Threatens Cigarette Tax Effort After Industry Hires Democrats to Fight Initiative

When the tobacco industry began organizing its campaign against a proposed November ballot initiative to raise cigarette taxes, there was little doubt its efforts would stir opposition.

But few expected the first volley to be fired by California Republicans, the very people the cigarette manufacturers turn to for help. Yet that is exactly what has happened, not because Republicans favor the initiative but because the industry did the unthinkable: It hired two prominent Democratic campaign firms to wage its battle.

Top Republicans in the Assembly and Senate are so angry at the decision that they have quietly threatened to push for higher cigarette taxes on their own if the tobacco companies do not fire the two firms.

To make sure their threat is taken seriously, these GOP leaders have enlisted the help of conservative U.S. Sen. Jesse Helms, the tobacco industry’s closest congressional friend, to intervene on their behalf.

“The tobacco industry around the country has heard about this,” Senate GOP leader Ken Maddy said Monday.

“Our Republican campaign consultants are struggling and starving to death between campaign cycles. Then to have our friendly interests, which traditionally are more closely associated with Republicans, going out and supplying money and wherewithal to finance Democratic consultants . . . doesn’t sit too well with us.”

It’s not unusual for Democratic firms to be hired by Republican interests, but this marks a rare instance in which Republicans have displayed outright indignation over the practice.

The real fear, these Republicans say, is that the huge fees and inside political information generated by the campaign will be turned against Republicans in legislative races. The tobacco initiative, which is widely expected to gather enough voter signatures to qualify for the November ballot, would boost cigarette taxes by 25 cents per pack and then spend the $650 million generated by the new tax for treatment, research and education on tobacco-related diseases.

The battle over the proposal is expected to be a high-spending affair with supporters, including the California Medical Assn., the American Lung Assn. and Assemblyman Tom Hayden’s Campaign California, pledging to raise at least $2 million. The tobacco industry, which fears the influence of some of the measure’s supporters and worries about other states following California’s lead, is expected to spend whatever it takes to beat the measure. Some sources have estimated that the tobacco industry will spend in excess of $10 million.

Tobacco industry representatives, who have been unsuccessfully battling anti-smoking regulations all over California, have refused to comment on the campaign consultant dispute. And the industry’s chief Sacramento lobbyist said he knew “absolutely nothing” about it.

But organizers of the cigarette tax initiative have heard about it and they were rejoicing Monday in the expectation that this political brouhaha will brighten the measure’s prospects.

“To the degree that the Democratic consultants working for the tobacco industry are preoccupied with fending off the Republicans, all this bickering is to the advantage of the tobacco tax initiative,” said Jack Nichol, the initiative’s campaign director.

The dispute began in late November when the tobacco industry hired two campaign firms widely known for their handling of Democratic races. They are Clinton Reilly Campaigns of San Francisco, which, among others, has managed races for former San Francisco Mayor Dianne Feinstein and Democratic State Sen. John Garamendi of Walnut Grove. The other, Townsend & Co. of Sacramento, ran Mayor Tom Bradley’s unsuccessful 1982 gubernatorial campaign against Republican Gov. George Deukmejian.

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Of particular concern to some Republicans is the fact that legal advice on the tobacco campaign will be provided by Ken Kachigian, a close political adviser to Deukmejian and President Reagan, and by Steven Merksamer, Deukmejian’s former chief of staff, now an attorney.

Some Republican lawmakers reportedly were concerned that, because of the Merksamer connection in particular, Republican election strategy and contributor lists might fall into the hands of the Democratic campaign firms.

Merksamer declined to comment, citing the “attorney-client relationship” his firm has had with the tobacco industry for more than a decade.

Jeff Raimundo, a consultant with the Townsend organization, said he believes Republicans had become “confused” and that it was the initiative’s Republican backers who were more likely to give sensitive information to the Democrats.

“It’s ironic,” Raimundo said, “because the California Medical Assn., which is a longtime Republican contributor, is financing basically a very liberal Democratic initiative.”

The Republicans have been unmoved by all the assurances. In a recent meeting attended by GOP members of both houses, it was suggested that a push by Republicans in the Legislature to raise cigarette taxes might get the industry’s attention where other measures have failed.

Future Discussions

“I think much of that depends on our future discussions with our caucus and the decisions made” by the tobacco industry, Maddy said.

Sal Russo, partner in a Sacramento-based firm that has run many Republican campaigns, said he believes the anger being displayed by Republicans in the Legislature is because business takes Republican support for granted.

“They (business interests) don’t worry about the Republicans because they agree with them philosophically,” Russo said. “That gets old particularly when the dollars are used in the trenches to beat you in a campaign.”