Rival Says Gallegly Should Give Donations From S&Ls; to U.S. Treasury

Democratic congressional candidate Richard Freiman, seeking an attention-getting issue for his uphill campaign against Rep. Elton Gallegly, Wednesday called on Gallegly to give $20,000 in contributions from savings and loan institutions to the U.S. Treasury to help pay for a massive federal bailout of the troubled industry.

Freiman, an Agoura attorney and television writer, said Gallegly (R-Simi Valley) should give the government the money to make it clear to constituents “that instead of being part of the problem, you are part of the solution” to the S&L; crisis, which regulators say will cost U.S. taxpayers $500 billion over the next 30 years.

Gallegly was traveling and unavailable for comment Wednesday, a spokesman said. But in a prepared statement, the congressman said that less than 1.5% of his overall contributions have come from the thrift industry and that he supported several bills to aid prosecution of S&L; fraud.

Freiman’s poorly financed campaign has attracted scant attention so far and political observers give him little chance of upsetting Gallegly. But like other Democratic congressional challengers around the country, he is trying to use thrift contributions as a political weapon against a GOP incumbent.

A recent poll by the Wall Street Journal and NBC News found that by a margin of 39% to 17%, voters hold the GOP more responsible than Democrats for the crisis. And they were evenly split over President Bush’s handling of the scandal, with 38% approving and 37% disapproving.

However, the same survey found that voters blame the situation much more on thrift executives than federal officials. Moreover, the poll showed that voters split almost evenly over whether they trust the GOP or Democrats more to fix the problem.

Freiman said a recent Common Cause study ranked Gallegly 49th out of 435 House members in the amount of contributions accepted from thrifts, although he was in Congress for only four of the nine years covered by the study.

Freiman said Gallegly “didn’t take any action” to stave off the thrift disaster, despite having been elected to Congress four years ago. “It was his responsibility as a member of Congress to do something about this,” Freiman said.

Freiman said Gallegly voted in favor of legislation that allowed S&Ls; to continue to invest in junk bonds.

In his statement, Gallegly said he voted in favor of seven bills designed to assist in investigating and prosecuting S&L; executives suspected of fraud.

Freiman, who left his job to campaign full time for the Nov. 6 election, faces long odds in his struggle against Gallegly in the 21st Congressional District.

Republicans outnumber Democrats 177,000 to 124,000 in the district, which covers western and northern portions of Los Angeles County and southern and central Ventura County. In the 1988 general election, Gallegly trounced his Democratic opponent, Donald E. Stevens, 69% to 29%.

In campaign finance statements filed in June, Gallegly reported having more than $100,000 in cash available for the fall campaign, a spokesman said. Freiman reported having $436 on hand.