Gov. Sees State Budget Help in Japanese TV Ads

With the state nearly broke, Gov. Arnold Schwarzenegger is touting a money-making idea to help California reopen its Tokyo trade office: starring in a Japanese commercial.

While leading a four-day trade mission here, Schwarzenegger said Wednesday that he may accept one of the many multimillion-dollar offers he receives to make commercials for Japanese television.

But instead of pocketing the money, he would plow it into an office that would push California’s business interests.

Schwarzenegger is a familiar figure in Japan, having appeared in several television ads while a movie star. The national nickname for him is “Schwa-chan,” with the last part meant to convey the sort of affection a parent feels for a child.

As part of California’s current tourism and marketing campaign, Schwarzenegger is displayed on a towering billboard near the Tokyo hotel where much of the California delegation is staying. Clusters of passing Japanese stop briefly to gawk at the image.

In a budget-cutting move last year, the state closed its 12 overseas trade offices. Money is still so tight that California cannot afford to reopen the offices without the sort of private donation he envisions, the governor said.

“We don’t have any money in the budget,” Schwarzenegger said. “I feel like always when we talk about the budget and there’s a program I want to fund but we don’t have the money, I feel like pulling out my own wallet and putting in money.”

Schwarzenegger described how the plan could work during a 10-minute interview with California reporters. The session came after he taped a separate interview with the Tokyo Broadcast System for a nightly news show that reaches more than 15 million people.

He would “do a quick spot and make a few million dollars and take that money and open up an office and not have to worry about our budget,” Schwarzenegger said.

“That’s really my mission.... Maybe in the next six months I will be able to accomplish that.... It’s quick money. You work for a day and the trade office opens. You have enough money for several years. That’s really the way to go.”

He continued: “All along while I’ve been doing this job, the offers are coming,” inquiring if he is “still interested in doing this for us or that. If I get a really good one that makes sense and ties us together -- California and Japan -- there’s maybe some meat on that chicken.”

The governor made commercials here in the 1990s for noodles, an energy drink and other products in which he pushed the creative boundaries, screaming into the camera in one testosterone-rich moment.

He said he has no doubts about his marketability. Even after a year spent negotiating workers’ compensation law and wrestling with the state’s budget shortfall, Schwarzenegger said, he is swamped with lucrative pitches.

“I’ve been offered, since I’ve been governor, many, many different movie parts,” Schwarzenegger said in the TV interview. He is asked “to do cameos in movies, or some movie studios suggest I take off three months from my governor’s job and do movies. I say I cannot do that. I’m committed to do my work as governor and I just put my movie career on hiatus for right now and not do that.”

But a TV commercial is another matter. Schwarzenegger said it would take little time and it would be for a good cause. When he hears that the state cannot afford certain programs, he said, he’s often tempted to pay for them himself. By cutting a Japanese commercial, he would be doing just that.

If the Japanese TV commercial idea works, Schwarzenegger said, he might try the same thing in other countries.

“Wouldn’t that be great?” he said. “The idea of it is how do I use my celebrity power? There are 4,000 governors coming here from all over the world. How do I single myself out? Elevate myself. Use the celebrity power to get in the various doors.”

Schwarzenegger’s proposal to use his own advertising revenue to supplement the budget renews a debate about the value of trade offices. Critics contend that they serve only to reward political supporters.

The state’s trade offices were closed after an Orange County Register report in May 2003 that the offices did not deserve credit that they claimed for increases in exports and investment. In many cases, the offices boasted of nonexistent business deals.

In the budget bill approved a few months later, lawmakers voted to eliminate the California Technology, Trade and Commerce Agency, which oversaw the offices. The closures seemed to have no effect on trade.

“The people who were put in charge of the state trade offices had no experience in doing anything other than carrying their baggage across international boundaries,” said Jock O’Connell, an international business consultant based in Sacramento. “These offices were established for political reasons. They were not designed to be business-oriented programs.”

Variations of the private-financing idea have gotten some consideration in Sacramento.

Soon after the trade and commerce agency was shut down, state officials began looking into new ways to stimulate investment in California abroad. An Assembly committee held hearings on alternatives and debated the merits of the kind of public-private partnership Schwarzenegger was proposing.

Florida has such a program, called Enterprise Florida. It is paid for with private funds, federal grants and state money.

A report that the Public Policy Institute of California presented to the committee encouraged state officials to consider public-private partnerships, but warned of potential conflicts of interest -- especially if the money is mostly from one donor.

“The biggest concern about a fully private office is, who would it be answerable to?” said Howard Shatz, a research fellow at the institute. “The office would have a state seal on the door, be considered by outsiders to represent California, but there is always the question of whether it is answerable to the people who fund it or the state.”

Jean Ross, executive director of the California Budget Project, voiced similar qualms. “If you start having particular firms finance trade offices, you have to question whether all California businesses will be treated fairly or will the offices represent the companies that contribute the most?”

For the next few days, Schwarzenegger’s focus is selling California. He is to meet with Japanese Prime Minister Junichiro Koizumi on Friday. On Saturday, before returning to California, he will attend an event promoting tourism.

He met Thursday with executives from Sony and Toyota before attending a reception, called “A Taste of California,” that promoted state agricultural products.

He confirmed that he wants to persuade Toyota to open a plant in California for production of its fuel-efficient hybrid Prius cars. One of California’s selling points is the passage of legislation this year that will allow solo drivers of vehicles that get at least 45 miles per gallon to use coveted carpool lanes, the governor said.

“We’re the No. 1 state really interested in energy-efficient cars,” Schwarzenegger said. “We cater to those cars. Diamond lanes are open to those cars. California will be the place.”

As for the Toyota meeting, he said: “We’re going to talk about all that. With each company we have a certain mission and will talk about different ideas about what we can do to [get them to] come to California and invest.”

Asked if he was prepared to woo Toyota with tax incentives, Schwarzenegger said: “I would help them every way possible.... There are many things we can do for those companies. We just have to act quick.”

An interview with Tetsuya Chikushi on Wednesday was polite and respectful, with the network news host asking the governor about his presidential ambitions, his views on the Iraq war and the state of his muscles.

(Answers: Schwarzenegger said he is not thinking about a bid for the presidency, but he supports passage of a constitutional amendment that would allow foreign-born citizens to run. He believes that the United States must recruit more European nations to help in Iraq. “It’s very important in the next four years that we rebuild some of those relationships internationally.” Muscles are just fine, thanks to a daily fitness regimen.)

A relentless salesman, Schwarzenegger revealed to the California reporters one of his tools: hype.

“It’s a campaign, interview after interview, to talk about how great California is and how happy I am to see this place change in front of my very eyes, because people are working together. Let them know the two parties are working together. Everyone is in sync and making it sound, basically, even better than it is. Because that’s what marketing is all about. Go out there. We’re right now at an 8 and make it sound like a 10.”

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Nicholas reported from Tokyo; Halper reported from Sacramento.