Workers’ Comp May Test Governor’s Battle Tactics

Gov. Arnold Schwarzenegger’s threat to state lawmakers this week was a familiar one: If they fail to pass the top item on his agenda, he will go around them and get what he wants by popular vote.

But Schwarzenegger has exposed himself to largely unfamiliar political risks by pursuing that strategy again, this time to prod lawmakers into a deal to cut the soaring cost of insurance for workers injured on the job.

The governor says he prefers to reach agreement with the Legislature, setting today as his loose deadline. That would hasten cost cuts in a workers’ compensation system that he calls “the poison of our economy.” It would also spare him the trouble of launching his third full-blown campaign in less than a year.

But if he fails to strike a deal with lawmakers and instead puts his plan before voters in November, Schwarzenegger’s quest for victory would be far more challenging than his previous campaigns for ballot proposals, analysts say.

Mainly, that is because his plan has sparked fierce opposition from powerful interest groups in Sacramento -- lawyers, doctors and labor unions among them. They are fighting it in the Legislature. Should Schwarzenegger take it to the ballot, they foresee spending heavily to defeat it.

“He still might be able to win, but it’s going to be a much harder battle,” said Elizabeth Garrett, a director of the Initiative and Referendum Institute at USC.

The risk: If he loses the statewide vote, she said, lawmakers will be less apt to take seriously any future threats by Schwarzenegger to bypass them when they resist his will.

In his earlier proposition campaigns, Schwarzenegger faced virtually no opposition -- a huge luxury in a state where television attack ads can quickly undercut a ballot measure. In 2002, when he entered the elective arena with Proposition 49, a proposal to expand after-school programs, the measure passed with a solid 57% of the vote after a flood of Schwarzenegger spots went unchallenged.

This month, the Republican governor won even bigger majorities for Propositions 57 and 58, his fiscal recovery measures -- again after an onslaught of ads unmatched by opponents.

“He has yet to put something on the ballot that mustered massive opposition,” said Garry South, a Democratic strategist who advised former Gov. Gray Davis.

But opponents of Schwarzenegger’s next potential ballot measure have already started preparing their campaign against it. Art Azevedo, an advocate for lawyers who represent injured workers, said the campaign could stress key changes proposed by Schwarzenegger, among them limiting injured workers’ choice of doctors. He also said opponents’ ads could portray the proposal as a boondoggle to enrich greedy insurance titans.

“Do I think we’re going to hire somebody to take pictures of their buildings and private jets? Yes,” Azevedo said.

But Schwarzenegger allies say the governor, much as he did earlier this month, could persuade Californians that his proposal was crucial to the state’s economic recovery -- even given the immense complexities of workers’ compensation.

Republican consultant Mark Bogetich said: “The one single thing that would cut through all of that would be Arnold Schwarzenegger telling the people of California: ‘This is important. Here’s why. Vote yes.’ ”

“If we weren’t confident we could win, we wouldn’t be pushing all the chips in,” said Rob Stutzman, Schwarzenegger’s communications director. “We don’t play a bluff game.”

In his campaign for Propositions 57 and 58, Schwarzenegger was widely applauded for assembling a broad bipartisan coalition. But a confluence of political needs helped him: Democrats campaigned for those measures largely to avert deep budget cuts that would hurt their constituents, and many Republicans saw them as an alternative to raising taxes.

Now, however, few Democrats are aligned with Schwarzenegger on his business-backed workers’ compensation plan.

In the recall, too, Schwarzenegger campaigned in a relatively favorable political climate. The unique ballot enabled him to avoid a Republican primary, usually problematic for a social moderate. And the race lasted just two months, maximizing the benefits of his fame while minimizing close press scrutiny of the first-time candidate.

Since the March 2 primary, workers’ compensation has been Schwarzenegger’s top priority. He cites the spike in insurance costs as a major drag on California’s job growth. Though he denounces fraud and abuse in the system, critics say his plan would curb benefits for injured workers.

This week, Schwarzenegger tried to turn those attacks to his advantage, using them to polish his image as a populist outsider sent by voters to curb the influence of special interests in Sacramento.

“If they think that they can control the legislators, and if they think that they can alter the deal, and make changes in the deal, or write it themselves like they’ve done previously, they are in the wrong place, because I will not let that happen,” he said Wednesday at a suburban superstore near Sacramento where supporters were collecting signatures for his ballot measure.

Schwarzenegger’s use of ballot measures as a key part of his overall political strategy is not unprecedented; previous California governors have sought to do the same. He has won so far, but history suggests the odds generally run against him: Since 1912, California voters have rejected nearly two out of three ballot initiatives.

The record of other governors has been mixed. In 1974, Jerry Brown, then California secretary of state, championed a campaign-money reform measure that helped fuel his victory that year in the governor’s race. A decade later, voters soundly rejected Gov. George Deukmejian’s proposal to remake the state’s political district map.

His successor, Gov. Pete Wilson, failed to win voter approval for a budget and welfare measure in 1992. But his support in 1994 for Proposition 187, a measure to deny public services to illegal immigrants, was a major boost to his reelection campaign.

Schwarzenegger’s repeated use of potential ballot measures to threaten the Legislature has irked some Democrats. Assembly Speaker Fabian Nunez (D-Los Angeles) said the governor and his advisors “need to really rethink their strategy.”

“I don’t think it helps build the atmosphere of cooperation that we all talk about,” Nunez said.

But Schwarzenegger, whose popularity and fame have made many lawmakers reluctant to criticize him, gained more clout by winning voter approval this month of Propositions 57 and 58.

“There is value in engaging in these kinds of fights, and winning them pays dividends,” said lobbyist Phil Isenberg, a former Democratic assemblyman. “The politicians who understand that building political capital, and wisely spending it, is the way to gain more capital are the ones who succeed.”

A legislative deal, however, would avoid an expensive, unpredictable campaign and bring concrete cuts in insurance costs within months, giving Schwarzenegger a quicker political triumph.

“Success breeds success,” said Don Sipple, a Schwarzenegger political advisor. “It’s as elemental as that.”

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Times staff writer Peter Nicholas contributed to this report.