ACTIVIST: Recall Governor Davis.
SPENCER MICHELS: For five months, conservative activists have hustled around the state seeking the 900,000 signatures needed for a recall vote. A special election this fall to decide whether embattled Governor Gray Davis keeps his job. Late yesterday, the secretary of state announced the recall would proceed.
KEVIN SHELLEY, Secretary of State, California: As of today, my office has received over 1.6 million total signatures. Of these more than 1.3 million have been found to be valid. All of us were very aware we were making history and setting precedent.
CRUZ BUSTAMANTE, (D) Lt. Governor, California: Now it's up to the voters.
SPENCER MICHELS: Reporter: In accordance with the state constitution, Lieutenant Governor Cruz Bustamante today set the early October date for the vote, a vote he says he opposes.
CRUZ BUSTAMANTE: Having a recall in my view is not the proper way of being able to do this. Just because you are mad at somebody doesn't mean you spend $35 million to oust somebody.
SPENCER MICHELS: Bustamante said the Davis recall ballot will have two questions: One: Should he stay in office, yes or no. Question two: If he is recalled, who should replace him? Under state law, nearly anyone can get run; all it takes is 65 signatures and $3,500. And the candidates with the most votes becomes governor the next day.
That's already prompted several unknowns including model Angelyne to start campaigning. Among prominent Republicans, U.S. Congressman Darrell Issa, who financed the recall effort, plans to run. Other names mentioned include Bill Simon, Davis' opponent in the last election, former Los Angeles Mayor Richard Riordan, and Hollywood strongman Arnold Schwarzenegger. Prominent Democrats including U.S. Senator Diane Feinstein have said they will not put their names on the ballot. Already, residents are predicting a divisive campaign.
PHIL COUZENS, Republican: I think he ripped the people of the state of California off for bunch of money. My opinion is most of them are crooks anyways but he is a little bit more crookeder than the rest and he needs to go.
ROB WEINER, Democrat: Because a few right wing, disgruntled Republicans decided they wanted to overturn the will of the voters they decided to make a recall election within days after the election in November. I think it's a terrible precedent.
DEMONSTRATORS: Corrupt, dishonest, stop Davis now!
SPENCER MICHELS: Davis detractors blame the governor for a host of California woes including a electricity crisis that saw blackouts and sky rocketing consumer prices and a $38 billion budget shortfall that will require big cuts to state's social, educational programs. Jim Brulte is the leader of California Senate Republicans.
JIM BRULTE, Republican Leader, CA State Senate: Governor Davis increased California's budget 37 percent. He did that with the Democratic legislature and a couple of Republicans, most of whom are no longer here. So is the entire deficit the governor's fault? No, but the vast bulk of it is.
GOV. GRAY DAVIS, (D) California: We have a different vision.
SPENCER MICHELS: Davis supporters say state tax revenues have shrunk in tandem with the economy and the dot com collapse. They blame Republicans for refusing any form of tax hike to balance the budget. They promise a tough campaign.
BOB MULHOLLAND, California Democratic Strategist: There will be no surrender in this state to this Taliban element of the California Republican Party.
SPENCER MICHELS: Yesterday Davis said it was an all out political fight.
GOV. GRAY DAVIS: I am going to fight like a Bengal tiger, and one of my greatest strengths is people have because underestimated me since I was born. Every time they say I'm road kill I continue to win because I have great faith that the California voters are fair and believe in fundamental fairness.
SPENCER MICHELS: Sacramento Bee columnist Dan Walters has watched state politics for three decades. He says the period between now and October 7 will be unpredictable at best.
DAN WALTERS, Columnist, Sacramento Bee: Somebody we may have never heard of could be governor in three months from now. There's that possibility. Is it probable, no, but this whole situation is improbable. Nobody -- this is all making it up as we go along because nobody has dealt with this sort of thing before.
SPENCER MICHELS: Already, state election officials are worried about how soon the election will be held. They're now scrambling to hire poll workers, identify voting sites, and update the old punch-card ballot system.
RAY SUAREZ: Gwen Ifill takes it from there.
GWEN IFILL: For a closer look at the California situation we're joined by two veteran political strategists. Chris Lehane advised Governor Davis in his reelection effort. He was also Vice President Al Gore's spokesman during the 2000 campaign. And Dan Schnur was the press secretary and communications director for former Republican Governor Pete Wilson. He also served as an adviser to Senator John McCain in his 2000 presidential run. Gentlemen, welcome.
So Dan Schnur, how did it come to this?
DAN SCHNUR: How did it come to this? Well, a lot of things happen in California just as a lot of things have happened across the county that have made angry and suspicious of their elected leaders. In other parts of country they handle it in different ways. They elect a wrestler governor in Minnesota. Democratic primary activists go online to support a candidate that opposes a war and in California angry and disaffected voters have a different tool at their disposal; they can go to the recall which is provided for in our state constitution that gives voters the right to reach out to politicians who don't keep the promises they make on the campaign trail and remove them from office. The recall mechanism is a very unique one, Gwen, but the anger and emotion behind it is something that is not unique to California at all.
GWEN IFILL: Chris Lehane is this just the fruit of an angry populace?
CHRIS LEHANE: Well Gwen, I think this is really just the extension what we saw in Florida in 2000. The Republicans time and time again lose at the ballot box and try to circumvent the democratic process. You saw that in Florida in 2000. We saw it in Texas with the legislative redistricting; we have seen it in Colorado with some judges. And now here in California we have a small group of Republican operatives who don't represent the vast views of the people of this state who have come together, abused and exploited the recall process and are attempting to hijack the state, all at the cost of $40 million to the tax payers of the state.
GWEN IFILL: Dan Schnur, abuse, exploitation, hijacking, you've got to respond to that.
DAN SCHNUR: Tough words from Lehane. The truth of the matter is California's political leaders put a system like this in place on purpose. They put in place the initiative process which allows voters to express their opinion directly on matters of public policy. They put referendum in place which allows voters to overrule an act of legislature and they put a recall in place which allows voters when they don't think the elected officials are doing the job they were elected to do to remove them to office. It's completely democratic; it's completely constitutional. There are moderate and conservative Republicans running in this election, there are Green Party candidates running in this election and there could even be Democratic candidates running in this election if the party leaders were to decide that was in their best interest. This is the ultimate expression of democracy.
GWEN IFILL: Chris Lehane, there is a $38 billion deficit in California right now under Governor Davis's watch. Isn't it possible maybe he is just doing a bad job?
CHRIS LEHANE: Well, the recall is not designed to remove someone from office merely because you didn't like their political policies or because they weren't politically popular. It was designed to remove someone from office because they engaged in some type of malfeasance. The great irony here is that you have someone by the name of Darryl Issa who himself has actually really engaged in malfeasance. He is been accused twice of stealing cars. Now he is the one actually funding this process. So ironically you end up with a situation where a recall device, which was created to remove someone for malfeasance, is being exploited by an actual malfeasor.
And if you take a look at really whether this really reflects democracy in action, I really have to question that. If you take a look at what a recall turnout will like, you're probably looking at about a 30 percent turnout, 35 percent turnout -- one third of registered voters and of that, if they answer yes on the recall you could have a governor elected with about 9 or 10 percent of the registered voters in the state. And what that translates into is you could wake up on October 7th with a governor who fundamentally has different views than most of the people in the state. We know Californians support choice; we know Californians support a clean environment; we know Californians support public education. And yet you could end up with one of these conservative people whose names are going to be on this ballot of the governor of the state who will be anti-choice, anti-public schools and anti-environment.
GWEN IFILL: Dan Schnur, I know you don't work for Darryl Issa, but I think somebody has got to respond to what Chris Lehane just said about labeling him a malfeasor.
DAN SCHNUR: Actually what I would like to do is correct my friend, Christ Lehane, who is a New Englander who's recently transplanted to California. Chris, actually impeaching an elected official requires an act of malfeasance. The removal of an elected official by recall is really up to the will of the voters. California voters can remove an elected official from office simply if they think he or she is not doing the job. That's exactly what California voters are doing here.
Darryl Issa, of course, is one of several Republicans considering this race, but it's not Darryl Issa that drove Gray Davis's approval ratings down to 20 percent. It's not Darryl Issa that caused a $38 billion budget deficit or a very expensive energy crisis. We're going to run pro-choice and pro-life Republicans. We're going to run Republicans who emphasize protection of the environment and who emphasize property rights. We would love to see Democrats on the ballot also. We're a little bit puzzled that they haven't decided to participate.
GWEN IFILL: Well, can I jump in for a second and ask you why, with all the things that you say are wrong with the state of California government right now, why does anybody want this job?
DAN SCHNUR: Well, I worked for former Governor Wilson during the last worst budget crisis in California history at the end of the Cold War when the aerospace industry suffered the same way that Silicone Valley has recently. And what I saw then is that even a governor forced to make very unpopular decisions during difficult times still has a great ability to influence the state of California and its future. That's why Republicans are running. That's why Green Party candidates are running. Again, we would love to see a Democrat in the race as well.
GWEN IFILL: Chris Lehane, is there a broader impact beyond California for initiatives such as this recall initiative?
CHRIS LEHANE: Well, as I mentioned earlier, I do believe this is an extension of what we saw in Florida in 2000. And I think the Democratic-base voters and Democrats in general there's this great anger out there that the Republicans will really do anything to circumvent the democratic process. I do think on a fundamental level of good governance this reflects a bad way of governing. At the end of the day regardless of who is the governor after October 7th, the people of California are going to be the people who are hurt. The state has an enormous budget challenge. That's what the public officials ought to be focusing on. By not focusing on that, by instead engaging in this recall that will cost about $40 million to hold the economy isn't going to get addressed. The budget isn't going to get addressed. The state is thrown into a period of time of uncertainty and at the end of the day it's going to hurt the people of the state.
GWEN IFILL: Is there any impact on this, Chris Lehane, on the outcome of the 2004 election? The guy you worked for, Al Gore, won California by 12 points last time even though George Bush spent a lot of time and money there. Does the outcome of this gubernatorial race affect that presidential campaign?
CHRIS LEHANE: Well, Democrats are extremely strong in California because Democratic views match up with the views of the people of the state. One sneaking suspicion that all of us Democrats have is the fact that this may be just the first step in a Republican to try to take California away from the Democratic Party. Obviously a Republican in the California governor's office will make it a little bit more challenging for Democrats. I find it very interesting that we have not heard word one from President Bush on this issue. Obviously if he wanted to convey a sign to the Republican Party to step back, he could have done that. He hasn't. He has said it's a state issue. I think it's a much more than a state issue. It will have a ripple effect all across the country. And the California economy will not be able to recover during this recall. If the California economy is not going to recover, the nation's economy is not going to recover. We drive the nation's economy out here in California.
GWEN IFILL: Dan Schnur, we heard Gray Davis say today and he's been saying it a lot, that he's always misunderestimated -- underestimated. People are always saying -- counting him before he is ready to be counted out and he can beat them back. Is he strong?
DAN SCHNUR: Gray Davis is always underestimated and Gray Davis is a very, very skillful campaigner. What makes him so good, Gwen, is this: Gray Davis is the absolute master of the lesser of two evils school of campaigning. He is extraordinarily talented at framing a choice between himself and an even less attractive option. The challenge he faces in this recall though is much different, because in the first question on the ballot, there's no other name; it simply says do you think Gray Davis should remain as governor or not, so while Davis has thrived politically by drawing those kind of contrasts with his opponents, that's what he seems to be doing in this campaign as well, ultimately Davis' best chance of success, I think, is to take the time to defend himself, rather than running down the alternatives. That's why people underestimate him but it's going to require a new approach for him to succeed this time.
GWEN IFILL: And Chris Lehane, how do Democrats run a campaign like this? Who turns out for an election like this?
CHRIS LEHANE: Well, I think Democrats are going to have a fundamental choice: Do they want to keep moving the state forward, or do they want to go backward? Do they want our state to be hijacked by a small, narrow group of folks who don't represent the majority of views of the state? And Democrats will become intense and Democrats will turn out to vote once the argument is put forth to them.
GWEN IFILL: The argument is that if they don't keep Gray Davis in office things could be worse?
CHRIS LEHANE: Well, the argument is quite straight forward which is at the cost of $40 million tax payer dollars do you want to have a recall that could potentially result in a Republican governor who is anti-choice, anti-environment, anti-public schools and anti-health care? That fundamentally will take this state backwards.
GWEN IFILL: Chris Lehane and Dan Schnur put on your seatbelts; we'll be watching.