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Economic Pessimism Pervades Heated California’s Governor Race

October 8, 2010 at 12:00 AM EDT
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As much of the nation's focus has been on congressional races in the upcoming midterm elections, 37 states will elect governors as well. Correspondent Spencer Michels takes a look at the expensive race for California's top job amid the state's massive economic problems.

JUDY WOODRUFF: And to politics here in the U.S.

Much of the midterm election focus has been on the battle to control Congress, but voters in 37 states also will choose their governors on November 2.

“NewsHour” correspondent Spencer Michels takes a look at the race for California’s top job between the state’s attorney general, Jerry Brown, and the former head of eBay, Meg Whitman.

It’s part of our Vote 2010 coverage.

SPENCER MICHELS: While California boasts the largest economy in the nation, these are rough times in the Golden State. Unemployment hovers above 12 percent. The state budget is perpetually way out of balance. The legislature is at odds with itself and with Governor Arnold Schwarzenegger.

Yet, two candidates are battling fiercely for the dubious honor of governing and fixing this troubled state, a job some think is nearly impossible. The Republican is Meg Whitman, 56-year-old former head of eBay and a billionaire who has spent more than $121 million of her own money, more than any self-funded candidate in history, providing her detractors with an issue.

PROTESTERS: California, be aware, Meg Whitman does not care!

SPENCER MICHELS: At a pre-debate rally in Davis, the California Nurses Association, a labor union, mocked her lavish campaign.

PROTESTER: I am your royal highness, Queen Meg.

SPENCER MICHELS: Whitman has flooded the air with waves of commercials to introduce herself to 17 million voters in a state where Democrats have a 13 percent voter registration edge over Republicans.

NARRATOR: And who says, if elected, he will ask voters for even more new taxes? Jerry Brown.

SPENCER MICHELS: But her free-spending campaign has become a target of her Democratic opponent, former Governor Jerry Brown.

JERRY BROWN, Democratic candidate for governor: At the end of the day, people have enough sense to tell what’s real from what’s manipulated, what is genuine from what is something that is contrived. And I present to you a real contrast. I’m not an advertisement. I’m a real person. You know what you’re getting when you see me.


SPENCER MICHELS: Whitman makes no apologies for her spending.

MEG WHITMAN, Republican candidate for governor: I don’t think you can buy elections. I think voters are too smart for that. What you can do is get your message out. And, you know, people really are beginning to understand that I am focused on creating jobs and getting government spending under control.

SPENCER MICHELS: But, for all the money Whitman has spent, she hasn’t been able to inoculate herself from a campaign crisis that erupted last week.

Nicky Diaz Santillan, Whitman’s former housekeeper of nine years and an illegal immigrant, accused her former boss of knowing of her undocumented status and mistreating her.

NICKY DIAZ SANTILLAN, former housekeeper of Meg Whitman: I want the people who clean houses and do the jobs that the others don’t want to do to be treated with respect and dignity.

SPENCER MICHELS: Whitman, who had been running ads saying she was tough as nails on immigration, and demanding penalties for employers who hire illegals, says she fired Diaz Santillan as soon as she learned of her status in 2009.

MEG WHITMAN: As soon as we found that she was an illegal immigrant, then we actually did what we had to do as an employer, was to let her go.

PROTESTERS: Go, Meg, go!

SPENCER MICHELS: At the site of California’s first Spanish-language debate in Fresno, demonstrators held brooms and other cleaning supplies to show solidarity with Diaz Santillan.

PROTESTERS: Hey, Meg, it’s not OK…

PROTESTER: … to throw a human being away.

SPENCER MICHELS: Brown supporters used the new issue to blast Whitman as a hypocrite.

At his campaign headquarters in Oakland, Brown said the controversy raised deeper questions.

JERRY BROWN: There’s also a question of values. How do you treat people? And this raises the larger question of the underground economy. There is a group of people, numbered in the millions, who are being exploited and who are vulnerable and our laws should protect. And if I’m governor, I will do precisely that.

SPENCER MICHELS: Today, Brown had a campaign crisis of his own, when The Los Angeles Times released audio of Brown aides referring to Whitman as a “whore,” accusing her of cutting a deal with police unions, exempting them from her proposed pension reforms.

Whitman’s campaign called the word an insult to women. Brown’s campaign apologized. When he was first elected governor in 1974, he was the state’s youngest to hold the office. If he were to win this fall, he would be its oldest. Now, at 72, Brown is one of five former governors nationwide trying to make a comeback.

JERRY BROWN: You know, I used to be governor, by the way, before some of you folks were born. And, you know, as soon as I left — as soon as I left the governorship, things started going downhill.

SPENCER MICHELS: Sacramento Bee columnist Dan Walters has been watching California governors since Jerry Brown’s first term.

DAN WALTERS, columnist, The Sacramento Bee: Even though he is 72, I still think of him in many ways like I did then, as kind of a kid, and as kind of a precocious child, kind of a perpetual college sophomore, you know, always flitting from thing to thing to thing. And he’s all excited about one thing one day, and all excited about something else the next day.

SPENCER MICHELS: So far, Brown has raised $33 million, although independent groups, mostly labor, have ponied up an additional $14 million. Now, with the election a month away, Brown’s commercials, mostly attacking Whitman, have just started hitting the air.

NARRATOR: Meet the real Meg Whitman. Serving on the board of Goldman Sachs, Whitman was caught reaping millions from insider stock deals.

SPENCER MICHELS: Supporters of each candidate have latched onto negative slogans to deride the opposition.

PROTESTERS: No more reruns! No more reruns!

PROTESTERS: You can’t buy our votes! You can’t buy our votes!

SPENCER MICHELS: As passionate as the supporters of each candidate are, Californians in general are profoundly pessimistic about this state’s economy and regard it as their top issue. A new Field poll shows that only 29 percent of Californians expect the economy to improve next year.

The new governor may not be able to solve those problems, economic or structural, says Sacramento Bee columnist Dan Walters.

DAN WALTERS: First of all, the governor doesn’t run the government. As Arnold Schwarzenegger found out, he has an awful lot less power than he — than somebody might think he does or he thought he would have.

And I maintain that California is fundamentally ungovernable, because it’s such a complicated state. And the structure of government that was invented in the 18th century and we adopted in the 19th century is not really terribly well-suited to the 21st century. And I think, until we change those structures, that any governor is kind of doomed to failure of a sort.

SPENCER MICHELS: Both candidates differentiate themselves from Schwarzenegger, who has lost much of his popularity.

JERRY BROWN: Governor Schwarzenegger has done some pretty good things, but he came at it from the private sector. He had not studied California as I have. And I feel now, at this point in my life, everything that I have done has prepared me for this undertaking.

MEG WHITMAN: I have an entirely different background than Governor Schwarzenegger. I have been in business for 30 years. I have run very large organizations. My experience in Silicon Valley, I think, is highly relevant, because what we need is a healthy dose of managerial expertise from a place that knows how to use technology to do things differently.

SPENCER MICHELS: Whitman’s Silicon Valley experience has been the hallmark of her campaign at scripted events like this town hall in San Jose, where Cisco Systems CEO John Chambers asked her why she is running.

JOHN CHAMBERS, president & CEO, Cisco Systems: What in your heart told you to do this? Because it is brutal, Meg.


JOHN CHAMBERS: And, as a friend, I worry.

MEG WHITMAN: Every day, I — the first question people ask me, why in the world would you subject yourself and your family to this? And the reason is, because I care about California. And where goes California goes the country.

SPENCER MICHELS: In this election, California has bucked the national trend. President Obama has not been the focus of Whitman’s campaign, and the Tea Parties have played only a small roll.

Whitman, who is pro-choice, has had to convince conservative Republicans to get out and vote for her.

CARLY HAMMOND, Fresno Young Republicans: I think a perfect conservative probably wouldn’t be the best choice for California, considering we are a blue state and traditionally vote Democrat. But I think she’s the best choice.

SPENCER MICHELS: But solar industry exec Jim Peterson thinks Brown’s the best choice.

JIM PETERSEN, CEO, Solar Roofing: Jerry’s the real deal. Jerry Brown, as long as I can remember, has supported renewable, sustainable, and clean energies.

SPENCER MICHELS: Independent polls show Brown with a four- or five-point lead over Whitman. One more debate is scheduled, and a host of dueling commercials are on tap. The outcome could well depend upon turnout, the wild card in this close race.