Wilson, McCarthy Hit Low Road on Money Issues : Rivals Battle Over Real Estate, Speaking Fees

Times Staff Writer

Campaigning for the U.S. Senate Monday, both candidates hit the low road, exchanging broad insinuations about one candidate's ownership of expensive real estate and the other's acceptance of public speaking fees.

Republican Sen. Pete Wilson touched it off with a televised campaign commercial that questions how his Democratic challenger, Lt. Gov. Leo T. McCarthy, could afford to own a pair of "luxury condominiums" worth $500,000 next door to LaCosta, the fashionable resort north of San Diego.

"Where does all McCarthy's money come from?" the ad asks. "We don't know," it replies, saying that McCarthy, unlike Wilson and the four presidential and vice presidential candidates, has not released tax returns covering the period he has been in office.

Property Investments

McCarthy said the LaCosta properties were purchased in 1986 and were the outgrowth of a series of real estate investments dating back to 1957.

On April 15, Wilson released tax returns dating back to 1978. During his 1982 Senate campaign, Wilson's tax returns became a campaign issue because they showed he had paid no federal taxes in 1980, thanks to a shelter that eventually was disallowed by the Internal Revenue Service.

When Wilson released his returns in April, he challenged McCarthy to do likewise. Since then, the lieutenant governor clearly has been wrestling with the issue.

He did release his 1987 return, but refused for months to make any other returns available to the press. Then on Sunday, the day before Wilson's ad aired, McCarthy told The Times he would release returns dating back to 1978. Late Monday afternoon, however, an aide announced that McCarthy had changed his mind and would not make those returns available.

The aide, Kam Kuwata, said McCarthy had changed his mind because releasing his returns now would look as though he were capitulating to Wilson's "personally offensive" campaign ad.

"It's clear Pete Wilson wants to insult the intelligence of the people of California with this kind of campaign ad, and Leo has decided to keep the campaign focused on the issues," Kuwata said.

Earlier in the day, McCarthy hit back at Wilson's commercial.

"Sen. Wilson is demeaning himself by making such a personal attack . . . ," McCarthy said, adding, "I have never attacked Pete Wilson's personal circumstances or talked about the wealth he has come into."

But moments later, McCarthy began questioning Wilson's judgment for accepting $176,000 in honorariums over the last five years in return for "trivial speeches" to business groups, "the majority of whom have a stake in legislation the senator has some power over."

McCarthy said he has never accepted an honorarium.

Andrew Poat, director of research for the Wilson campaign, said Wilson does not accept honorariums from groups with interests in "significant or controversial" legislation that has come before the senator or that is likely to come before him. Moreover, Poat said that Wilson, who is a member of the Armed Services Committee, refuses to accept any honorariums from defense contractors.

However, Senate Ethics Committee reports show that Wilson accepted a $2,000 honorarium from the Wine Institute, a wine industry trade association, after he introduced the Wine Equity Act which sought to lower European Common Market barriers to the importation of American wine.

$7,000 in Honorariums

The Ethics Committee reports also indicate that Wilson, who has exerted influence over farm and food legislation as a member of the Agricultural Committee, received $7,000 in honorariums last year from groups representing growers, fertilizer manufacturers, food processors and candy makers.

Meanwhile, another issue surfaced in the Senate campaign Monday during a Santa Monica forum on long-term health care sponsored by a coalition of groups, including the American Assn. of Retired Persons.

It was an event tailor-made for McCarthy, who has made care for aged and disabled people a personal crusade during his 20-year career in state government.

McCarthy said that, if elected, he would call for $1 billion in federal aid for home health care for severely disabled people. He described the proposal as a modest one, only one-sixth the amount of money recommended in a bill in Congress which was defeated earlier this year.

McCarthy said his proposal would address the needs of about 20% of the people who need long-term care. Eventually, he said, he would be in favor of extending Medicare coverage to cover everyone in need of long-term care.

Eunice Sato, a former mayor of Long Beach, represented Wilson. She outlined a bill Wilson introduced last year that would set up a pilot program among federal employees, allowing them to convert a portion of their life insurance to long-term care insurance.

Wilson's bill reflects the approach he has taken to other social issues--relying less on use of public money and more on the private sector.

McCarthy scoffed at Wilson's approach as an election-year placebo and took Wilson to task for not coming to the 10 a.m. forum Monday.

Wilson's campaign manager, Otto Bos, said Wilson, who had spent Sunday night in Los Angeles, took an 11 a.m. plane back to Washington. Bos said that Wilson had accepted an invitation to attend a similar forum sponsored by the AARP in October.

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