Some of the financial moves surrounding the Prop. 14 open primary measure make it clear that Gov. Arnold Schwarzenegger’s campaign reform efforts haven’t touched the money side of politics.
A flood of cash has been pouring into the Prop. 14 campaign ever since a financial report released last Monday showed that the effort was beyond broke, with about $90,000 more in bills than it had cash in the kitty.
No sooner had the Los Angeles Times mentioned that the campaign was on the shorts than Reed Hastings, the Netflix CEO, dropped $257,000 into the effort. The very next day, the governor’s political piggy bank, better known as Arnold Schwarzenegger’s California Dream Team, pumped another $500,000 into the campaign.
A deeper look at those financial records, however, shows why there’s a continuing concern about how money is used – and reported — in political campaigns.
In the days before the March 17 campaign reporting deadline, the money situation was grim for the Prop. 14 team. While there was $416,000 in unpaid bills, the campaign only had about $78,000 in the bank.
Now that’s not necessarily unusual for political campaigns. While they have a well-earned reputation for being slow to pay their bills, the bills generally do get paid as more contributions trickle in. Still, the shortfall was embarrassing and could have raised some uncomfortable questions about just how committed the backers of the open primary measure really were.
But on March 16, the day before the close of the fiscal period, the California Hospital Association’s political arm came through with a check for $250,000. The Prop. 14 committee rushed to report that contribution the very next day, making their financial report look a whole lot rosier when it was made public last Monday.
On that same day, the hospital group also gave $250,000 to the California Dream Team, which didn’t report receiving the money until last Thursday. That was the day before the governor’s group gave its $500,000 check to Prop. 14.
So, in effect, the hospital association gave half a million dollars to the Prop. 14 campaign, even though the group’s name is only on half of it. By giving the money to the governor’s political action committee, they put some distance and deniability between that money and the campaign, as well as reminding Schwarzenegger that they’re in his corner.
Committees like the ones run by the governor, legislative leaders and others also have the advantage of disguising money from sources both sides might prefer not to see directly on a campaign finance report.
While good government types backing the open primary effort might be a little nervous if they saw names like Chevron, PG&E, Sempra Energy and Wal-Mart on the list of donors, not to worry. While all those companies have given big bucks to Schwarzenegger’s PAC, it’s the governor’s name, not theirs that will appear alongside the contribution to Prop. 14.
Sure, you can find the names of those donors to the donor, but it takes some effort. And good luck ever learning how much each member hospital gave to the California Hospital Association’s political action committee.
Since the March 17 close of the last financial reporting period, more than $850,000 has flowed into the Prop. 14 campaign and you can bet there’s plenty more to come. With the Schwarzenegger years winding down in Sacramento, the governor is thinking about his legacy and campaign reform looks like his best hope.
In 2008, Schwarzenegger, with the help of good government groups like Common Cause and the League of Women Voters, pushed across Prop. 11, which took the every-10-years reapportionment out of the hands of the Legislature in the hope of creating fairer, more competitive districts.
Prop. 14 would build on that by opening primary elections to all comers, with the top two finishers, regardless of party, meeting in the November election.
Schwarzenegger has said that he has millions in commitments for the campaign, so if Prop. 14 loses it won’t be because of lack of money.
There are plenty of financial questions on the opposition side, however. So far, the “No on 14” effort consists of little more than a website and two campaign committees with a total bankroll of $1,000.
The various minor parties hate the idea of the “top two” primary, since it would likely eliminate them from the campaign trail in June. But if they could raise the millions needed to finance a major effort against Prop. 14, well, they probably wouldn’t still be minor parties.
State Republicans and Democrats aren’t any happier about the prospect of open primaries and could likely raise the cash to put up a serious fight. Whether they will or not is another question.
The major parties probably are still kicking themselves for not putting up more money to fight the Prop. 11 redistricting effort, which barely squeaked through in the 2008 Obama landslide.
John Wildermuth is a longtime writer on California politics.