Calif. GOP gov race tightens as attacks intensify

[June 03, 2010]  SACRAMENTO, Calif. (AP) -- Meg Whitman's shot at the Republican gubernatorial nomination looked as easy as an eBay bid: Plunk down nearly $81 million and wait for the clock to run out.

Yet in the final days before Tuesday's California primary, the former chief executive of the online auction company is on the defensive, challenged by a well-funded rival who has made an issue of her lack of support for Arizona's tough immigration law, her ties to embattled Wall Street investment giant Goldman Sachs and her inconsistent record of voting in elections.

State Insurance Commissioner Steve Poizner has even tried -- in a web-only video -- to link her to eBay's expansion in the online pornography market.

Suddenly, the numbers don't look as good for Whitman, the 53-year-old billionaire political neophyte who argues that her business expertise as the CEO who built eBay into a Fortune 500 company can turn around California's woeful finances. Her 50-point lead in the polls has dropped to as low as 10 points amid some wildly fluctuating surveys.

Waiting for the Republicans is Democrat Jerry Brown, 72, the state attorney general, one-time presidential candidate and former governor who wants his old job back.

Brown uses his website to remind voters of his tenure as governor in the 1970s, saying California cut taxes and built a surplus. He has called his Republican rivals "apostles of darkness and ignorance," setting the tone for a fierce general election campaign to succeed Republican Gov. Arnold Schwarzenegger.

The GOP race in the most populous state mirrors many of the fights playing out elsewhere, particularly the battle over who is the true conservative. Yet in California, where Democrats and moderate independents comprise a good chunk of the electorate, Republicans who move too far to the right often are forced to scramble back to the center.

The initial tightening of the race coincides with the beginning of critical ads by Poizner, who built a vast personal fortune in Silicon Valley by developing GPS chips for cell phones. Poizner, also 53, has spent $24 million, nearly all of it his own, targeting Whitman on a handful of issues. He waited until the final weeks of the race and caught some lucky breaks.

He had just begun to make an issue of illegal immigration when a national uproar erupted over the Arizona law requiring police to request papers of anyone they suspect might be in the country illegally.

Poizner supports the law, as well as cutting off most state services to illegal immigrants and their children. Whitman wants greater border security but said she does not support the Arizona legislation or cutting off health care and other services to the children of illegal immigrants. She says they should not be punished for the actions of their parents.

Recently, the federal government filed civil fraud charges against Goldman Sachs, where Whitman was a board member in 2001-02 and was implicated in the now-illegal practice of "spinning." That practice gave wealthy clients and CEOs whose companies did business with Goldman early access to IPO shares, which they flipped quickly for large profits. Whitman said she forfeited the $1.8 million she made off the deals in a lawsuit she settled with eBay shareholders.

Whitman, who has spent $71 million of her own personal fortune, has answered with ads painting Poizner as a flip-flopper, saying he has changed his position on taxes and government funding for abortion.

The ads have distracted the candidates from focusing on the top issues worrying most Californians -- economic stagnation and the lack of jobs.

The state's economy has been hammered especially hard by the recession, with an unemployment rate that has hovered above 12 percent for months, among the highest in the nation. Construction, manufacturing and retail sales have plunged over the past three years, leading to a dramatic drop in tax revenue to state and local governments.

Spending from the state general fund has tumbled by $20 billion over the past three years, leading to teacher layoffs, reduced health care for the poor and deep cuts to a wide range of social services.

The effects of the downturn can be seen just about everywhere in California's vast Central Valley, one of the most productive stretches of agricultural land in the country but also a region beset by economic turmoil.

Foreclosed homes and storefronts litter the valley's small towns and line its highways. In some areas, unemployment is above 30 percent.

In the 15 years Tim Drake has owned The Village Sandwich Shoppe in downtown Manteca, business has never been worse. The landlord helped by slashing his rent, but he still had to let waitresses go.

He said he plans to vote for one of the Republicans in the upcoming primary but is among the roughly 30 percent of likely voters who remain undecided. He is doubtful that either candidate can deliver on promises to cut government spending, his top priority.

"It's gotten totally out of hand. Whether it's a Republican governor or a Democrat governor, it's just too much spending," he said. "There won't be anything left."

Carlon Perry, who was mayor of the town about 60 miles south of Sacramento from 1998 to 2002, believes this year's elections are California's "last hope." He said he supports Whitman because she is an outsider who he hopes can do for California what she did for eBay, taking it from a startup to a global force in Internet business.

"We're going down the drain now," he said. "You can talk to small businesspeople and talk to the working stiff, and it's not getting any better for them."

Whitman promises to eliminate 40,000 state workers and create 2 million private-sector jobs through targeted tax cuts.

But as she seeks to prove her political legitimacy, Whitman risks looking like some of the insiders she wants to throw out. After hiring a full roster of advisers from the early years of Schwarzenegger's administration, Whitman has promoted endorsements from some of the GOP's biggest names.

Her supporters include former Secretary of State Condoleezza Rice, former Vice President Dick Cheney and 2008 presidential candidate Mitt Romney, her first boss out of Harvard Business School, who has campaigned with her in California. She was adviser to Romney's presidential campaign in 2008, then switched to the eventual nominee, John McCain, after Romney dropped out.

[Associated Press; By JULIET WILLIAMS]

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