Modest Donor Squeezed Out of Governor’s Race

In the debate over the millions of dollars being spent by the candidates for governor of California during this year’s primary election, one aspect of the campaign’s finances has gone largely unnoticed: the virtual elimination of the modest donor.

Once a bulwark of political participation, the engaged citizen who gives $10, $20, even a few hundred dollars has become an anachronism in a race that has seen the ascendance of big money.

Gov. Gray Davis and Bill Simon Jr. each have averaged more than $5,000 per contribution in their campaigns--in Simon’s case, those numbers include millions he has lent to himself. Richard Riordan has averaged about $4,000 per donation.

By contrast, former Gov. Pete Wilson won reelection in 1994 when more than 28,000 people donated to his campaign. His average donation in that campaign was less than $1,000.

Those figures play out against the national debate over campaign finance reform, and supporters of new contribution limits cite the changing character of donations--along with the staggering amounts raised--as evidence of the need for change.

“Quite frankly, it is a major factor contributing to the disengagement and alienation of people from the political process,” said Jim Knox, executive director of California Common Cause. “The message the voters get is that their contributions don’t matter.”

With no legal limit on the size of contributions in this year’s gubernatorial race, the bulk of the money fueling the campaigns of both parties is coming from a small circle of big-ticket donors. It includes corporations, associations such as labor unions, and wealthy friends and family members of the candidates.

The leading candidates of both parties have benefited, but Democrat Davis has amassed more money from fewer people than any of his three Republican challengers.

Relentlessly courting big money since the day he took office, Davis raised $28.4 million in 2000 and 2001 alone from fewer than 5,000 donors, an average of nearly $6,000 per donation. More than 90% of Davis’ money came in contributions of $5,000 or more.

The two leading Republican challengers--both multimillionaires who are tapping their business connections for help--also are heavily reliant on big money.

Riordan, whose $9.3 million in contributions leads the Republican field, has averaged more than $4,000 per contribution through mid-February. Over that same period, Simon lent his own campaign $3.7 million and raised $700,000 more from his family. (Last Wednesday, he lent himself another $1 million.) Simon’s average contribution is more than $5,000.

That leaves little room for donors such as Shirley R. Freedland, an 82-year-old retired speech therapist. Although she thinks of herself as a “dyed-in-the-wool Democrat,” she liked Pete Wilson as governor, so she sent a $50 check to his reelection campaign.

This time around, she’s sent Davis two checks totaling $150.

Helped by contributors such as Freedland, Wilson built a huge grass-roots base of fund-raising support. As a sitting governor, he too raised millions of dollars, but he relied on a much larger pool of sources.

Davis’ chief political strategist, Garry South, said the campaign has worked to build a base of small contributors.

“We have been doing telemarketing since the fall of 1998,” South said. “We have done direct mail. We do fund-raising through the Web site.”

He said the effort has brought in 18,000 donations of under $100. Even so, the impact on the campaign has been nearly negligible.

According to reports filed with the secretary of state, Davis had less than $500,000 in donations under $100 during 2000 and 2001, about 1.7% of his total. Wilson recorded nearly $1.3 million in contributions of under $100, about 4.6% of his total.

South called the comparison to Wilson unfair because the former U.S. senator ran two campaigns under the $1,000 federal contribution limit before his race for governor. Davis has never run for federal office and so has built his contributor base under California’s rules, which have changed over time but today do not impose any limits on contributions in the governor’s race.

In one sense, the 2002 gubernatorial campaign promises to be the last gasp of unrestricted political fund-raising in California. The next election will be governed by Proposition 34, the 2000 statewide initiative that set a $20,000 limit on contributions for governor.

Law Exempted Race for Governor

All legislative races currently fall under even lower limits established by the proposition, but the gubernatorial campaign does not because the law, authored by state Sen. John Burton (D-San Francisco), exempted it.

South suggested that even when the new limits imposed by Proposition 34 take effect, small donors will not suddenly become a force.

“It is a total myth for anyone to suggest that . . . if you just ratchet the fund-raising limits down to an extreme level you are going to force these candidates to go out and raise millions of dollars from $10 donations,” South said. “No matter how beneficial someone might think that would be for democracy, it is not realistic, not practical and not cost-effective. That is why no one is out there doing it.”

Though they disagree with South about the reasons, some political reform advocates also are skeptical that the new limits in gubernatorial campaigns will restore the position of the small political giver.

“I think it is too high,” said Robert M. Stern, president of the Los Angeles-based Center for Governmental Studies, a nonprofit group that monitors campaign reform around the country. “It still allows contributions up to $20,000, which is much higher than most states and much higher than the federal law which applies to the president and Congress.”

To a large extent, the money paying for California elections today comes from institutional givers--the kind Stern describes as “afraid not to give.” They are unions representing workers on the state payroll or on state-funded construction. They are businesses concerned about workers’ compensation reform. They are telecommunications companies subject to state regulation.

Often they give to both parties and even to opponents in the same race. Among at least 200 institutions and individuals that gave both to Wilson and Davis were Health Net, AT&T;, the Wine Institute and the California Building Industry Council.

On average, these donors gave 58% more to Davis than they had to Wilson eight years earlier.

Several of them refused to speak about their political gifts. Others spoke only in generalities about why they give.

“We support candidates who are reasonable when it comes to our industry,” said Health Net spokeswoman Lisa Haines. “It doesn’t mean they always agree with us. But when they don’t, they disagree reasonably.”

Political donors are especially tight-lipped about how they decide whom to give to and how much to give.

“I would say from our standpoint, action by a government official is never tied to the amount of money you give,” said Jennifer Kent, director of government and external affairs for the California Optometric Assn., which gave Wilson $48,450 but scaled back its contributions to Davis to $30,000. “We don’t equate the two. Our giving has nothing to do with what we seek in the Legislature. They are two completely separate activities.”

Kent said the escalating gifts merely reflect inflation.

But some insiders say that pressure from the candidates themselves pushes up the level of giving.

The goal is to maximize the candidate’s time by setting up personal contacts that will bring in the most money, said John Plaxco, who once raised money for former U.S. Sen. Bill Bradley (D-N.J.) and Sen. Dianne Feinstein (D-Calif.), but now practices his craft in private philanthropy.

“To get the governor to show up for something, there needs to be a certain amount of money they’re going to be able to raise,” Plaxco said. “A lot of times a campaign will set their internal benchmark to determine what’s going to justify taking out an hour and a half of the candidate’s time. Time is really the critical factor. There’s a real deadline. There are only so many days. There’s a lot of competition for this person’s time to do all kinds of things.”

Despite those constraints, Plaxco said he encouraged his candidates to make the effort to widen their donor bases.

“It’s a politically smart thing to do,” he said. “To raise a million in small contributions of 15 to 25 bucks is a lot of people. It will bring your average down. You get less a percentage of your money from wealthy people.”

But building a wide base of small donors is laborious and unpredictable, said George Gordon, the consultant who ran Wilson’s campaigns. It takes expensive mailings that can backfire if war or natural disaster turns donors’ attention elsewhere. And it requires grass-roots organizing that becomes more difficult each year.

Nonetheless, at Wilson’s insistence, Gordon pulled together a statewide organization with a committee in each county that kept the small donations trickling in.

People Want to Be Involved

“It’s good to energize the smaller donor,” Gordon said. “Bottom line, it’s not money but votes. People want to be involved in campaigns.”

And any politician who spurns that desire risks turning off voters like Ed Friendly, who says he gives out of a begrudging sense of duty.

“I hate the fact that all these candidates have to raise this money to run for office,” Friendly said. “I think it’s indecent. But it’s an unfortunate fact of life.”

The political contributions of Friendly, the retired producer of “Laugh-In” and “Little House on the Prairie,” make him about an average giver to the current campaigns.

He gave Wilson $5,000. Then he gave Davis $5,000 for his first election campaign. But now he’s switched loyalty. He memorialized his support for Riordan with a $2,000 check last November.

Friendly said he harbors no illusions about what it will get him.

“I have no access,” he said. “I don’t have enough money to have an impact on the campaign with Gray Davis spending most of his time raising money. That’s one of the reasons I gave to Richard Riordan.”

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Davis, Wilson Donations

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