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Governor Moves to Undercut Angelides

Times Staff Writer

Gov. Arnold Schwarzenegger’s agreements this week on a minimum-wage hike and prescription drug discounts solidifies an election-year transformation that robs his Democratic opponent, Phil Angelides, of coveted middle-class issues.

Since voters rejected his largely conservative special election platform last November, Schwarzenegger has methodically shed all links to his calamitous second year in office.

He replaced his strategists with a team imported from two distant lands: a campaign manager from Washington, D.C., and a chief of staff from the Democratic Party.

He showed that he had absorbed the lesson of the special election -- that lawmakers, not the electorate, should be responsible for governing -- by striking a $116-billion public works deal with legislators.

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And now he has distanced himself from the business groups that have long been his major backers and helped finance last year’s campaigns. The California Chamber of Commerce and other Republican-aligned organizations firmly opposed raising the minimum wage, which the governor agreed to Monday.

A day later, Schwarzenegger adopted the Democrats’ approach to lowering drug prices for the working poor -- a parting of ways with the pharmaceuticals industry, a consistent ally that has donated more than $1.1 million to the governor’s campaigns.

That was a stark break: In his first two years, Schwarzenegger sided with the industry on eight of nine bills, vetoing measures intended to make it easier for people to import cheaper drugs from Canada and to give the state more leverage to negotiate lower prices.

Now Schwarzenegger is in intense negotiations with Democrats on legislation that would cap emissions from factories and other immobile sources of pollution. If he can reach a deal before the Legislature adjourns Aug. 31, he’ll have a major environmental achievement to tout before the Nov. 7 election.

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“He’s trying to kick all the legs out from under the Angelides stool,” said Garry South, who ran state Controller Steve Westly’s unsuccessful primary against Angelides, the state’s treasurer. “They’re doing a pretty good job of it, I must say.”

All this puts Angelides in the tough spot of having to knock Schwarzenegger for doing things Democrats and many independent voters support.

“I’m happy that we’re making progress on some of the issues that are good for Californians,” Angelides said at a campaign stop Wednesday in Burbank. “But let’s be clear about it: This is happening because the Democrats, we’re pushing our agenda forward, and the governor’s signing things to save his own job. Think of what we could have if we had a governor who is truly committed to helping middle-class families.”

Speculation is not restricted to the prospect of a Democratic governor: Schwarzenegger’s latest political twists are raising questions about which direction he’ll go if he wins a second term.

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“What we get for the next four years is anybody’s guess,” said Dave Gilliard, a Republican strategist in Sacramento. “I don’t think there is an Arnold philosophy that you can quantify. I think he makes decisions on the fly.”

Indeed, with many of the major legislative issues he is working on, Schwarzenegger is giving himself plenty of future leeway.

In talks about raising the state’s minimum hourly wage to $8, Schwarzenegger demanded that Democrats drop their call for automatic cost-of-living increases. Future governors -- including him, if reelected -- will retain the power to decide whether to continue raising wages.

In negotiations on prescription medicines, Schwarzenegger agreed that drug makers failing to provide discounts for working-class families could be penalized, but he left it to future administrations to decide when that was warranted.

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And the governor is demanding that his administration have wide latitude in setting up the state’s program to regulate greenhouse gas emissions.

“He’s telling everyone to ‘hold your breath and trust me,’ ” said Doug Heller, executive director of the Foundation for Taxpayer and Consumer Rights, a Santa Monica advocacy group. “History makes me leery of believing there’s any real reform contained in any of these last-minute legislative deals.”

While many Republicans are not thrilled about Schwarzenegger’s latest deals with Democrats, even those who have been shunted aside in recent decisions are still backing him over Angelides.

“We support him because we think overall he has been a good governor of the state and turned many things around,” said Jot Condie, president of the California Restaurant Assn.

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Many Democrats are less than confident that their good relations with the governor will last beyond this year. They view the next week as their best and possibly last chance to win Schwarzenegger’s signature on their bills.

“We’re seeing him on so many issues just caving in and throwing in the towel,” said Dario Frommer of Glendale, leader of the Democratic caucus in the Assembly. “This is a governor who I believe will say or do whatever is necessary to get reelected.”

Times staff writer Michael Finnegan contributed to this report from Los Angeles.


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