Why Wait, Commissioner?

If Chuck Quackenbush believes he has any credible defense against the accusations mounting against him, he’d better pull it together this week. But if the embattled state insurance commissioner continues to stall, to deny any knowledge of the irregular and probably illegal goings-on in the Department of Insurance over the past 16 months, the Legislature should immediately plan impeachment proceedings.

Quackenbush could save everyone a lot of trouble by resigning. So far, he has refused. The commissioner might reconsider after reading the results of the new statewide survey by the Field Poll. About half of those contacted said he should quit. If he does not, the respondents urged 54% to 21% that he be impeached.

Even among fellow Republicans, Quackenbush’s approval rating has plummeted, down to a mere 15%. This reflects a remarkable level of public anger and outrage over the actions of an elected official. And in this case, the public appears to be well ahead of the politicians in reaching for an appropriate punishment.

Quackenbush is scheduled to make a third appearance before the Assembly Insurance Committee next week. During his earlier testimony, the second-term officeholder was often defiant, if not contemptuous, of lawmakers attempting to unravel the process by which the Department of Insurance elicited $12.8 million in donations from major insurers involved in the 1994 Northridge earthquake.

The money, paid in lieu of up to $3 billion in fines, was diverted to private foundations established by Quackenbush, ostensibly to develop programs of earthquake research and outreach to minority communities and to reimburse aggrieved victims of the quake. Instead, millions of dollars were pumped into television ads and a public relations campaign with little apparent purpose other than to polish Quackenbush’s political image. One of the foundations, California Research and Assistance Fund, set aside $6 million for quake reimbursement, but none of that was ever spent.

The coming hearings, put off for a week from their originally scheduled start, will also feature an appearance by George Grays, a former Quackenbush deputy who was at the center of the foundation maneuverings. Quackenbush repeatedly has said he knew nothing of the operations or the decisions to spend insurance company money on non-insurance causes such as $500,000 to the Sacramento Urban League, of which Quackenbush was a board member, and $263,000 to a Sacramento area youth football camp that was attended by Quackenbush’s children.

Insurance company executives have testified that Quackenbush was involved in at least one of the meetings at which firms were persuaded to donate to the foundations in order to escape fines, a procedure akin to extortion. One foundation official testified she did not sign checks that bore her name, adding that the handwriting appeared to be Grays’. Another cautioned Quackenbush about uncontrolled foundation spending. Foundation board meeting minutes were faked; the board never met.

Even if Quackenbush did not make such decisions, it is obvious the foundations were run out of his department, mostly from Grays’ office. On Friday, The Times reported that a Quackenbush political consultant’s memo appeared to urge the commissioner to solicit insurance executives for more money to fund these dubious ventures. The sorry list goes on and on.

The backstage maneuvering this week could be fierce. Grays may refuse to testify without immunity from prosecution. If he gets immunity, what kind of new box will that put Quackenbush in? The relentless drip of new revelations is likely to continue, and fellow Republicans will continue to wish for a way out. It is very hard to grasp what keeps Quackenbush in office at this point. He has much to answer for, but nothing he can say will save his reputation.