Outsider’s Team Full of GOP Insiders

Since he declared as a Republican candidate for governor, Arnold Schwarzenegger has cast himself as a crusading outsider who wants to smash the influence of entrenched “special interests” in the state Capitol.

Yet he has surrounded himself with GOP insiders who have ties to businesses with a stake in government actions.

His key campaign strategist is Bob White, who formed a high-powered public affairs consulting firm in 1997 after serving as former Gov. Pete Wilson’s right hand for three decades in the San Diego mayor’s office, Congress and the governor’s office.

Although White has taken a leave while working for Schwarzenegger, his firm does work for an organization of chief executives of major California corporations -- and it is closely allied with a lobbying firm for companies in oil, tobacco, liquor, energy and other industries.

Top aides for winning candidates often transfer to policy-shaping jobs in new administrations, or they enjoy access to the governor’s office for themselves and the people they represent.

But Schwarzenegger maintains that any business interests connected to White and White’s partners would have no special sway in his administration.

“Bob has never told me who his clients are, and I have no idea,” Schwarzenegger said in a recent interview. “So I think he has no interest in that.

“I run my ship. I will do what is right for the state and the people, and not special interests.”

In addition to White, the movie star’s campaign apparatus is packed with people with close ties to the state’s last Republican administration. Among them are former Wilson campaign strategist George Gorton, press secretary Sean Walsh, communications consultant Jeff Randle and policy researcher Paul Miner.

Schwarzenegger has been criticized by political opponents, some of them Republicans, for at least creating the appearance that his tenure would be a reprise of the Wilson years.

But Schwarzenegger said that, although White is a trusted friend and advisor, no one should assume that White, Wilson or anyone else is shaping his ideas. “Bob is a very knowledgeable man,” he said. “It is true he is an insider. But I’m the outsider. He’s not giving me his philosophy. I have my own philosophy. I have my own opinions.”

In the Capitol consulting corps, White is viewed as a ubiquitous and well-liked sage who sells advice to blue chip firms and others on political and economic matters. He operates behind the scenes -- and across political lines.

“Bob White is one of the most talented political strategists ... in the state,” said San Francisco mayor and former Assembly Speaker Willie Brown, a lifelong Democrat and longtime friend of White’s. “He has more relationships, more contacts, more wisdom than anyone on the Republican side of the aisle.”

It was no surprise that Schwarzenegger turned to White for advice, first for his successful Proposition 49 after-school program initiative last year, and recently for the recall race.

Schwarzenegger had known and supported Wilson for years, heading his governor’s council on physical fitness and even backing his controversial Proposition 187 immigration measure. And White’s firm, California Strategies, as one lobbyist recently put it, was so filled with ex-aides that it seemed like the “Wilson administration in exile.”

Among his partners are former Wilson Cabinet member Joanne Kozberg, now a UC regent, and former Wilson deputy Cabinet secretary Camden McEffee. Another is lobbyist-lawyer John C. Flanigan, an ex-Wilson mayoral aide.

Most of White’s colleagues have strong Republican ties. For example, Gary Hunt, a former Irvine Co. executive, was state campaign vice chairman for President George W. Bush in 2000.

One partner, John “Rusty” Areias, is a conservative Democrat who was Davis’ state parks director during the governor’s first term and was part of the so-called Gang of Five state Assemblymen who tried to wrest the speakership from Brown in the 1980s.

White and his company are not registered as state lobbyists, so they are not required to disclose their client list. And White declined to discuss his business relationships.

However, according to records and interviews, the roster includes the California Business Roundtable, an organization of chief executives, and the Catellus Development Corp., a San Francisco-based real estate developer, as well as General Motors and AT&T; Corp., which has donated more than $1 million to state political campaigns since mid-2002.

Reports filed by the companies this year show that they routinely hired lobbyists to work on issues being considered by state agencies. AT&T; identified several matters before the California Public Utilities Commission, whose members are appointed by the governor. Catellus reported lobbying efforts at the state’s transportation department, the high-speed rail authority, the Legislature and the governor’s office. And GM lobbyists worked on the Air Resources Board’s mandate for more zero-emission vehicles.

White’s firm is affiliated with and shares a Sacramento suite with Flanigan’s family lobbying firm, which does work for companies that include R.J. Reynolds tobacco company, Exxon Mobil Corp. and Pacific Gas & Electric Co., which is regulated by the state PUC.

California Strategies also has provided consulting on land developments and other issues before local agencies.

For example, White and McEffee were registered as lobbyists in San Diego for a financial management firm that wanted to turn a municipal airport into a cargo hub but was defeated in 2001 by neighborhood opposition. And the company worked on a 225-home development proposed for an environmentally sensitive East Bay area.

“Generally, we represent businesses and organizations who have long-term goals and objectives in California, and part of the planning process requires a public affairs/public policy component,” McEffee said in an interview.

Schwarzenegger defended his decision to work with former members of the Wilson administration, saying there are a limited number of Republican campaign consultants in California. “I am an outsider, but it does not mean you take someone who has never run a campaign to a run a campaign.... That would be a mistake.”

The governor’s race is not the first time Schwarzenegger has sought help from White and other former Wilson aides. They were central to his first political success, Proposition 49.

After leading the governor’s physical fitness council, Schwarzenegger maintained contact with White and McEffee, who was liaison to the council. They would occasionally get together in Los Angeles and talk about current affairs and politics. Then in 2001, the consultants said, the actor broached the idea that would become Proposition 49.

“Arnold and I were friends, and over a long time, he talked about what he wanted to do regarding kids,” White said. “And he indicated he wanted to do a proposition” to get more money for after-school programs at California public schools.

Early that year, Schwarzenegger had told The Times he had been thinking about running for governor, but he did not challenge Davis in last November’s election.

“I realized that I had my obligations, and there was no way of running at that point,” he said in a recent interview. “So I just forgot about it. I said to myself that I would just continue with my after-school program crusade.”

With White as his highly experienced advisor, conditions were favorable for the actor’s inaugural campaign. He had money and celebrity. He chose an issue with broad appeal -- and little likelihood of strong opposition.

White’s firm was not set up to run the nuts and bolts of political campaign strategies. So he ran Proposition 49 through Gorton’s California Group 2 campaign firm, which records show was paid more than $750,000 by the campaign.

In shaping the ballot measure, Schwarzenegger’s team enlisted after-school advocates.

“We wanted to know their views on the issue and the potential sponsor,” said McEffee, who joined White in working on Proposition 49 but not the gubernatorial campaign.

Gorton, a strategist who helped get Russian President Boris Yeltsin reelected in 1996, honed the multi-pronged message for a paid media campaign -- that after-school programs improve educational achievement, prevent crime and save money in the long run. Policy consultant Paul Miner dug out research that would support Schwarzenegger’s position. And other aides briefed Schwarzenegger about the positions of newspaper editorial boards and other people he would be meeting.

But for all his campaign team’s strengths, the most important weapon in the Proposition 49 campaign was Schwarzenegger himself.

“We, as consultants, were blessed,” McEffee said. “We had a world-class icon stepping onto the California stage.”

Escorted by White or McEffee, Schwarzenegger made the Capitol rounds, wooing legislative leaders and even Davis’ education secretary. And White organized a reception to help garner broad, bipartisan support that eventually included the Davis administration.

Stumping gave Schwarzenegger political exposure and contacts that could prove helpful in a gubernatorial race. He gave dozens of speeches to groups such as the California Chamber of Commerce, the PTA and the 335,000-member California Teachers Assn. The CTA endorsed him and donated more than $500,000 after union officials and the actor hammered out ballot language that clearly stated that funding for basic education would not be eroded by the measure.

Ultimately, the measure passed with 57% of the vote in November.

Schoolchildren may not see Proposition 49 money anytime soon because of the state’s budget woes.

The measure calls for money to flow automatically from the state general fund when the non-education part of the budget grows by a certain amount. And legislative analysts say that is not expected to happen before roughly 2007.

Opponents say children would have been better served if Schwarzenegger had taken the tougher political course of establishing a new revenue stream for after-school programs. They point to the successful Proposition 10 campaign by movie director Rob Reiner in 1998, which uses a new cigarette tax to pay for early childhood development programs.

But Schwarzenegger said, “I am not into raising taxes.” The key to getting money is to improve the business climate and the state’s revenues, he said.

San Francisco Mayor Brown, who considers Schwarzenegger a friend, said he believes the after-school campaign was designed in part to be a potential path to the governor’s office in 2006.

At a Proposition 49 media event, Brown recalled, he quipped to Schwarzenegger: “If you win this 49 thing, that could launch you to the stratosphere” politically.

When Schwarzenegger jumped into the recall race, his Proposition 49 Web site, joinarnold.com, was seamlessly transformed into his campaign Web site.

Schwarzenegger said that his political aspirations had never entered into his Proposition 49 sponsorship -- and that the campaign did not do much to help prepare him for a gubernatorial race.

“You have to understand that, whatever move you make, people say this is because you are running for governor,” he said. “I sold my Ferrari -- and people say, ‘You are selling your foreign car and want to buy American cars because you are running for office.’ ”