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Bizzes asked to fund Schwarzenegger's China trip
(latimes.com)
Updated: 2005-10-25 09:18 To pay for a coming trade mission to China, Gov.
Arnold Schwarzenegger's political allies are raising tens of thousands of
dollars from businesses whose names are largely being concealed.
California Gov.
Arnold Schwarzenegger talks with supporters during his third
'Conversations with Californians,' a town hall-style meeting Friday, Sept.
16, 2005, in San Diego. Schwarzenegger confirmed an open secret Friday,
telling supporters that he's running for re-election next year _ an early
announcement designed to re-energize his sagging political momentum.
[AP] |
In addition, at least two of the three
public relations firms playing a role in the visit have political ties to
Schwarzenegger. One has a West Coast affiliate co-owned by the governor's chief
fundraiser.
Those arranging the weeklong trip, which will follow the special election
next month, are crafting an itinerary that potentially offers the traveling
business delegation exclusive access to Chinese officials and a private
reception with Schwarzenegger. The list of companies joining him is not yet
complete.
Schwarzenegger and his supporters want donations to two tax-exempt groups
that have championed his interests, and to a government fund meant to boost
overseas trade. The money will help cover expenses for the governor's tour of
Beijing, Shanghai and Hong Kong.
The administration says the fundraising effort saves taxpayers money, but
experts in public ethics question the governor's practice and the access it
affords private interests.
When private money finances government activity, elected officials can be
compromised, they said. And voters cannot hold officials accountable if they
can't learn where all the money came from and what donors may receive in return,
they added.
Some of the companies that have been approached are being asked to give
$50,000 to a tax-exempt group called the California Protocol Foundation,
according to people associated with the firms. The foundation's board members
include the president of the California Chamber of Commerce, the state's leading
business lobbyist.
The foundation's purpose is to reduce government costs through private
contributions, and it will be the main source of money for the China trip,
according to a Schwarzenegger aide involved in the planning. The group does not
release names of its donors, nor is it required by law to do so.
Officials of Chevron said the oil and gas company has given $75,000 to the
foundation in the last two years and will join the governor in China. The
company also has given $296,000 to Schwarzenegger's campaign funds, state
records show.
Jack Coffey, director of state government affairs for Chevron, said the
corporation gave to the nonprofit group because "we think the state needs to be
a player in Asian trade matters."
Coffey said the company plans to make the trip because of its "significant
business interests in China." Chevron markets liquid natural gas there, company
officials said.
More private money will be collected for another tax-exempt group launched by
Schwarzenegger last year: the California Commission for Jobs and Economic
Growth. It will pay for promotional events and advertising while the delegation
is in China, possibly including a billboard featuring Schwarzenegger.
The jobs commission has staged splashy events showcasing the governor to lure
employers to California. Executive Director Mark Mosher said he would ask
companies for "as much as we can get" to pay for events in China touting
California exports.
Administration officials also want agricultural firms and other businesses to
help pay for the trip by donating up to $10,000 to a fund maintained by the
state's Business, Transportation & Housing agency.
Agency secretary Sunne Wright McPeak and A.G. Kawamura, secretary of the
California Food and Agriculture Department, recently sent a joint letter to
businesses asking for donations to the fund.
Records released by the Schwarzenegger administration show that in 2004,
business interests and various industry groups representing agricultural
products contributed nearly $90,000 to the fund. The money was used to help
underwrite Schwarzenegger's trade mission to Japan last November.
The Chamber of Commerce donated $10,000 to the fund at that time. In his
recent actions on bills the Legislature sent him, Schwarzenegger vetoed seven of
eight bills that the Chamber of Commerce had labeled "job killers."
The California Tree Fruit Agreement, which represents plum, peach and
nectarine growers, intends to donate to the fund and join the traveling
delegation. Blair Richardson, president and chief executive of the group, said
growers had been trying to get "open access" to the Chinese marketplace for 11
years. China represents up to $90 million in potential exports, he said.
"We see the governor has the ability to get people to look beyond the
politics inherent in most of these things," Richardson said. "We'd just like to
hopefully draw more attention to the fact that it's time to open this market for
our fruit."
Bob Williams, project director for the Center for Public Integrity, a
Washington-based watchdog group, said that if Schwarzenegger deems the China
trip important to California's economy, he should ask taxpayers to foot the
bill. Asking private business to pay exposes him to "every kind of conflict of
interest," Williams said.
"There's no clearer conflict of interest," he said, than "asking the people
who have the most at stake to pay" for the trip.
Margita Thompson, a spokeswoman for the governor, said Schwarzenegger was
easing taxpayers' burden.
"As the three governors before him have done, he will rely on the Protocol
Foundation to help alleviate any burden that would have been placed on
government, so we can market California opportunities abroad while at the same
time minimizing the impact on taxpayers," Thompson said.
Former aides to then-Gov. Gray Davis said that in 1999, when Davis traveled
to Europe and the Middle East with a business delegation, he released the names
of contributors who helped pick up the tab.
"We just decided it wasn't worth taking the heat to try to protect donors,"
said Garry South, who is now aiding Controller Steve Westly, a Democratic
candidate for governor.
To manage the business delegation traveling with the governor, the Protocol
Foundation has hired the public relations firm Apco Worldwide. Two former
members of Schwarzenegger's staff, Cassandra Pye and Denise Davis, joined Apco's
Sacramento office this year. Both are going on the China trip, which begins Nov.
14.
Another public relations firm tapped to help with the visit is Manning
Selvage & Lee. The firm retains as its West Coast branch a company co-owned
by Martin Wilson, Schwarzenegger's main fundraising aide.
That firm also won a state contract last year to help arrange the governor's
four-day trade mission to Tokyo.
United Air Lines is offering discounted fares to businesses accompanying the
governor to China, according to an Oct. 7 invitation sent out by the
Schwarzenegger administration.
United lobbied the governor's office this year on pending legislation,
according to records filed with the secretary of state's office. And the
airline's in-flight magazine published an article praising Schwarzenegger's
handling of last year's Japan trip.
"Schwarzenegger artfully steered reporters' questions away from all things
political or controversial and stuck with talking up California's assets," the
article said.
Up to 50 people representing various business interests are expected to take
the China trip, according to those arranging it. A few high-tech and
agricultural firms plan to go, in hopes of boosting California exports to that
market and drawing attention to piracy of software, music and movies.
Robert Holleyman, president and chief executive of the Business Software
Alliance, based in Washington, D.C., said, "California is the home of the U.S.
software industry, and the levels in piracy in China are enormous. Nine out of
10 software programs in use in China are pirated."
One company planning to attend is UT Starcom, an Alameda company that makes
wireless communications equipment. Hong Lu, the president and chief executive,
is a member of the jobs commission.
China, he said, represents "a tremendous opportunity for California companies
to sell their technology and equipment."
A letter sent by Mosher, of the jobs commission, to various businesses to
gauge interest in the trip included an itinerary that listed potential meetings
with Chinese government officials in Beijing, a private reception with
Schwarzenegger in Hong Kong and various receptions to which business
participants could invite associates.
And a memo from Mosher to economic development groups in January lays out the
types of deals the state is hoping to announce on the trip: "Please note that we
are only interested in products or services that are not
controversial."
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