PAY TO GRAY
California Gov. Gray Davis is feeling increasingly
nervous about his campaign finances. No, he has plenty of cash. But
that may be the problem: it’s where he got all that cash. Concerned
about increased press scrutiny into his fundraising tactics, Davis
and his mudslinging staff have begun strategically leaking negative
financial material about Republican opponent Bill Simon,
Jr. But what little dirt they are finding isn’t directly
tied to Simon. “He’s pretty clean, actually,” says a Davis staffer
based in Los Angeles. “But whenever you own a large company there
is bound to be something you can get pinned on.”
And in the case of Simon, it’s a relatively small story. The
San Francisco Chronicle reported on Friday that Simon’s
firm, William E. Simon & Sons, was fined by New Jersey
securities regulators for so-called “pay to play” deals in the
early 1990s with New Jersey financial entities owned by close
associates of then Gov. Jim Florio. “Pay to play,”
is a technique commonly used by private firms seeking access to
government officials and contracts.
And it’s a technique Gov. Gray Davis is
currently under almost constant attack for practicing. For example,
in the past year Davis has accepted large campaign donations from
Enron, software giant Oracle, the union of state prison guards,
Northrop Grumman’s Logicon and most recently, the management
consultants Accenture, as he was considering state policies that
would have affected those entities.
“We needed to tar the other guy,” says a Sacramento-based Davis
campaign aide, who helped track down the Simon material for the
campaign’s opposition research team. “Simon was getting off
scot-free. Basically, if you tell the Chronicle Simon is
dirty, they’ll run with it. More than the L.A. Times and
the Sacramento Bee, they do us favors. This time was no
different.” During the Republican primary, the Chronicle
became notorious for receiving negative story leads about former
L.A. mayor Richard Riordan from the Davis
camp.
But Davis’s seemingly voracious appetite for cash will continue
to cause him problems, if only the California media would focus on
his donors.
For example, there is Alexander F. Kanakaris,
who has donated more than $30,000 to the Davis campaign in the past
year. In August 1999 Kanakaris was forced to settle with the
Securities and Exchange Commission, without admitting or denying
the allegations, that his firm misled potential investors about the
financial stability of his company.
“Davis has all kinds of characters like this on his fundraising
roles, if people would just take the time to look,” says a Simon
staffer.
PAC IT IN
New York Republicans are pressuring former New York City Mayor
Rudy Giuliani to create a political action
committee to help his party compete in upcoming elections. “He’d be
able to raise a couple million in no time,” says a New York
Republican source. “And it would help him if he decided to run for
higher office in the next couple of years.”
The pressure on Giuliani is partly the result of Sen.
Hillary Clinton’s ongoing success in raising money
for her national and New York PACs, which have more than $2 million
and half million in the bank, respectively.
Given Guiliani’s name recognition and through-the-roof approval
numbers, says the New York source, “a Rudy PAC could bury her and
the Democrats no problem. He could even farm out some of that cash
to friendly Democrats. He’d be untouchable.”
In approaching him, Republican consultants showed Giuliani data
that indicated he could pull in more than $2 million in the next
six months from a broad base of donors, making him a political
kingmaker for eager state and local candidates, as well as
congressional Republicans.
Giuliani said he was interested, but not ready to make that kind
of commitment to the party. “We’ll bring him around,” says the
source. “He can’t stay out of politics forever. It’s in his
bones.”
