End OF THE Line : Alan Cranston had a gift for fund-raising. But tapping S&L; tycoon Charles Keating Jr. proved the downfall of his political career.


During four decades as a dominant force in California politics, Sen. Alan Cranston (D-Calif.) lived something of a double life.

To the liberal Democrats who worked on his campaigns and served as the backbone of his political strength, Cranston was seen as an idealist--a man devoted to arms control, civil rights and helping the poor.

Yet at the same time, in the eyes of the wealthy California businessmen who contributed large sums of money to his political campaigns, he was a man whose strong support for home-state economic interests made him their dependable ally on Capitol Hill.

It was this combination of liberalism and boosterism that served as “Cranston’s own version of political magic,” as one longtime friend describes it. His unique ability to appeal to both liberals and business interests enabled him to overcome his self-acknowledged lack of personal charisma to be elected to the Senate four times.


“He is not what you would call handsome; he’s not long on personal magnetism,” says Cranston’s friend, who declined to be identified. “Alan’s also been astute enough to realize that you can’t be elected in California on his brand of ideology. And that is why he has tended to California’s economic interests with great care.”

But as sometimes happens in politics, the secret of Cranston’s success eventually became the tragic flaw. When his supporters learned that their idealistic, hard-working senator had been financing his campaigns with money from the likes of former Lincoln Savings & Loan owner Charles H. Keating Jr.--the man accused of bilking thousands of elderly Californians out of their life savings--polls showed that support for him vanished almost overnight.

Few successful political careers end as tragically and ignominiously as that of Alan MacGregor Cranston, 76, the former California controller whose tireless devotion to the nuts-and-bolts of politics ultimately earned him the vaunted position of assistant majority leader of the Senate.

Already, the Keating scandal has forced him to give up his leadership position and to announce that he will not seek reelection in 1992. And now, the final blow: Cranston has been charged by the Senate Ethics Committee with violating Senate rules.

The six-member committee announced Wednesday that Cranston “engaged in an impermissible pattern of conduct” by promising to intervene with federal regulators on Lincoln’s behalf at the same time he was soliciting contributions from Keating, who has become a symbol of the collapse of the savings-and-loan industry.

What makes Cranston’s humiliation even more dramatic is that he has always been a man with a reputation for personal integrity. Throughout his career, he has been an outspoken critic of funding political campaigns with special-interest money and has fought for public campaign financing.

“I have been trying to reform campaign finance laws ever since I got here,” he told members of the Senate Ethics Committee. “I think it is ironic that after all these steps I find myself in this kind of situation.”

Nevertheless, the Keating affair was by no means the first time Cranston has been accused of fund-raising excesses:


* As controller of California in the early 1960s, he was accused of trading government jobs for campaign contributions.

* In 1974, as a member of the Senate Banking Committee, he acknowledged he had set up an office in San Diego with $20,000 given to him by two bankers.

* And more than a decade later, he was forced to pay the second-biggest fine ever levied by the Federal Elections Committee for fund-raising irregularities during his unsuccessful 1984 presidential campaign.

Likewise, Cranston has been accused of using his influence on behalf of his rich contributors. He contacted the Securities and Exchange Commission on behalf of junk-bond king Michael Milken, a contributor, when Milken was under investigation. And he played a key role in winning a tax break for winemakers Ernest and Julio Gallo, also big contributors.


Five years ago, Jon Fleming, then a Cranston aide on tax matters, told The Times that the senator had sought so many such tax breaks for wealthy Californians that “my friends on the Finance Committee laugh when they see us coming (and) say, ‘What kind of whoring job are you guys working on now?’ ”

In the final analysis, Cranston is seen by his friends and political allies--almost all of whom refused to speak on the record--as a victim of his own fund-raising success. As one acquaintance puts it, “When you get into a good thing, you just get carried away.”

It was Cranston’s idealist streak that caused him to get involved in politics more than 40 years ago. After working as a foreign correspondent in Europe in the early 1930s, he returned to the United States with the goal of warning Americans about fascism.

Cranston got his start in state politics as a leader of the California Democratic Council, a group that taught him the value of grass-roots voter contact.


Although his goal always was to be a U.S. senator, Cranston first ran for state controller on a ticket that was swept into office in 1958 with Gov. Edmund G. (Pat) Brown. Even then,Cranston had a keen eye for fund-raising opportunities. Friends say he chose the office of controller because it gave him the opportunity to appoint a vast network of tax appraisers who could be expected to contribute to his reelection campaign.

In fact, Cranston’s fund-raising among tax appraisers became a political issue in 1964, when he ran for the Democratic Senate nomination against Pierre S. Salinger. Salinger found two former tax appraisers who claimed they had been forced to resign because they refused to contribute to Cranston’s campaign. Cranston countered with an unsuccessful libel suit but lost the election anyway.

Cranston lost the controller’s job in the 1966 California Republican sweep. But in 1968, when he ran again for the Senate, he won.

On Capitol Hill, Cranston established himself as a leading liberal--calling for an end to the war in Vietnam, speaking out for arms control and anti-poverty programs, and battling offshore drilling. His reputation in California as an “egghead” followed him to Congress and helped him get elected assistant majority leader in 1977. He led Democrats in some important battles, including those over ratification of the second Strategic Arms Limitation Talks pact and the Panama Canal treaty. (SALT II was never ratified.)


It was in 1971, when he championed the fight for government loan guarantees for Lockheed, that Californians got their first glimpse of Cranston’s willingness to go to bat for California business interests. At the same time, he began to solicit campaign donations from wealthy businessmen in the state, many of them prominent Republicans.

“Cranston, the liberal, was a big surprise when he got to the Senate,” says California political consultant Joe Cerrell, who has known the senator since the 1950s. “The ultra-liberal idealist turned into an extremely practical politician. . . . Cranston was the first Democrat (in California) to make a big mark by getting prominent Republicans to support him.”

The senator viewed the California business community as his natural constituency. Coming from a prosperous Palo Alto family, he had worked in the real estate investment business with his father before going into politics.

“He was an entrepreneur himself,” said a former aide, “and he has always had that point of view.”


As a member of the Banking Committee, Cranston was close to banking and savings-and-loan executives. Judging from the thick file of letters he wrote to the Federal Home Loan Bank Board over the past decade--all still in the board’s archives--Lincoln Savings was by no means the only thrift he aggressively assisted.

Cranston has consistently maintained that the contributions he received from banking and other California interests had no connection to his work on their behalf.

But unlike most other politicians who wince at the thought of begging strangers for money, Cranston--in the view of a friend--"enjoyed it, almost.” Aides say he spent hours on his office telephone “raising dough” as he called it, and he always could be found calling potential contributors at the airport pay telephone when he traveled.

By his own admission, whenever Cranston found a big giver like Keating, he repeatedly went back to that person for more money. He told the Ethics Committee that he had discovered that rich contributors were flattered to be asked for huge sums.


When he met new potential contributors, he systematically wrote their names down on 3x5 cards he carried in his coat pocket--a reminder to call them for money.

At first, Cranston’s fund raising was designed to win reelection. But he eventually built a fund-raising machine that exceeded his needs, so he began raising money for other Democrats, too. During nearly a quarter of a century in Washington, he raised more than $25 million for his own Senate and presidential campaigns, as well as millions more for other politicians and causes he supported.

In recent years, as the cost of campaigning grew, Cranston stopped searching for individual contributors, who under the law could give him no more than $2,000 for each election, and focused on finding people willing to raise $25,000 or more for him. Charles H. Keating Jr. was such a person.

As a result of Cranston’s skill in raising money and his success as a Senate leader, it seemed logical to him in 1984 to take the next step: running for President.


In retrospect, Cranston’s presidential bid is sometimes viewed as a joke. Many observers still chuckle at the idea that this bald, gaunt-looking 69-year-old man with no charisma would consider himself presidential timber in a television age. Cranston fueled the ridicule by dying the fringe of white hair around the side of his head an orangish-red color in an attempt to look younger.

But Cranston’s presidential campaign was no joke, especially not to him. He garnered some popular support in Iowa and New Hampshire by speaking out against the nuclear arms race and raised an impressive $9 million. When he bowed out after finishing seventh in the New Hampshire primary, he felt satisfied that he had at least made a respectable showing.

Political analysts cite Cranston’s presidential campaign as a turning point in his career: a setback that precipitated a gradual decline in his support among California voters. When he ran for reelection two years later, he barely beat Rep. Ed Zschau (R-Los Altos), a moderate, by a slim 50% to 47%.

After his narrow victory over Zschau, according to aides, Cranston was persuaded that the key to his party’s success in California was to register more Democratic voters, mostly young people, Latinos and blacks.


As a result, he began raising money for voter registration. Although federal law restricts regular campaign contributions from individuals to $2,000, there is no limit to the amount a person can give to a tax-exempt voter registration group.

Cranston first encountered Jim Grogan, Washington lobbyist for Keating, at a Democratic fund-raiser in 1984. “I’ve been very good to the savings and loans,” the senator told him, according to Grogan’s testimony before the Senate Ethics Committee. “You all should support me.”

Cranston instantly recorded Grogan’s name on a 3x5 card. A few days later, the lobbyist got a telephone call from Cranston’s chief fund-raiser, who asked if Keating could host a fund-raiser for the senator. Like many of Cranston’s contributors, Keating was a conservative Republican.

Eventually, Keating raised more than $40,000 for Cranston’s campaigns, $85,000 for the California Democratic Party for get-out-the-vote activities during Cranston’s 1986 reelection campaign, and $850,000 for voter registration groups founded by Cranston and his son Kim.


Had the savings and loan industry not collapsed, had Lincoln not been the biggest thrift failure (costing the taxpayers $2 billion), had Lincoln not sold now-worthless junk bonds to more than 200,000 Californians, Cranston’s relationship with Keating might never have come to light.

Keating was not even the biggest contributor to Cranston’s voter registration effort. Records show the senator persuaded McDonald’s owner Joan Kroc to kick in $1 million.

But Keating’s role as a symbol of the high fliers who drained money from the nation’s thrift institutions, combined with Cranston’s intervention on his behalf with federal regulators, was a potent political liability the senator could not overcome.

Even before the Senate Ethics Committee held hearings into the Keating affair, exit polls following the last election showed that Cranston’s support had virtually disappeared. A short time later, he announced he was retiring in 1992 because he had been diagnosed as having prostate cancer and needed to seek treatment.


Although Cranston’s cancer treatment caused him to miss most of the Ethics Committee hearings, aides say he will be back in Washington by Tuesday, in time to prepare the case he will present to the Senate in his own defense. After his response, the committee is expected to recommend that Cranston be censured by the full Senate.

After years of distinguished service in the Senate, Cranston clearly feels he has been betrayed by the system.

And in the end, two things about the Keating affair seem to rankle Cranston most. He strongly resents the implication in many news reports that he benefited personally from Keating’s generosity and emphasizes that he never pocketed one cent of the money. He also fears the scandal has besmirched the reputation of his son and always stresses that Kim did not profit from the voter registration organization he ran.

Cranston says he regrets the Keating affair, but not because he thinks it was wrong.


“Personally and politically,” he told the Senate Ethics Committee, “I wish to God I’d never heard of Charles Keating. It would be easy for me to say that I wish I had not done what I did. But I have gone over these events in my mind, and I’m confident that what I did was right and proper.”