Governor’s new chief of staff piles it on;

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Susan Kennedy now also is head campaigner

The San Francisco Chronicle

Susan Kennedy has been described as Satan, a sellout, a traitor, a spy — and a brilliant political operative.

And if that’s not enough, Kennedy — the Democratic workhorse who has become Republican Gov. Arnold Schwarzenegger‘s chief of staff — has recently assumed one more title: head campaigner.

As she goes around the state — from boardroom to business group, talking up Schwarzenegger’s $222 billion Strategic Growth Plan — the former top aide to Democratic Gov. Gray Davis is unapologetic about her chief priority these days: “To get Arnold Schwarzenegger re-elected.”

“And I truly believe that it needs to be a landslide,” Kennedy said confidently during a recent interview in San Francisco, where she was addressing business groups. “Because marginal wins create paralysis.”

The focus and energy invested on behalf of the state’s chief executive is one reason Kennedy is at the center of a new firestorm regarding ethics in Sacramento.

In an unusual arrangement, she is paid as the governor’s chief of staff, and separately as a campaign adviser.

Already, her $131,000 taxpayer-funded state salary as chief of staff has been bolstered by at least $25,000 for political consulting to the Schwarzenegger campaign, state financial records show. The Los Angeles Times reported last week that Kennedy received the bonus from Schwarzenegger’s campaign late last year after the governor had announced her new appointment, but while she remained a member of the state Public Utilities Commission. In addition, Kennedy will get $75,000 more this year for her campaign work, administration sources confirmed.

The new jobs, she said, come after years as a public servant and policy wonk — and she is matter-of-fact about why now.

“I’m 45 years old; I got a mortgage to pay,” Kennedy said. “And staying in state government was not in my plan. If I’m working 80 hours a week, why shouldn’t I be compensated for giving strategic advice to the campaign — just like the boys?

“I’ve done 25 years of political campaigns. I bring a lot of value on those issues.”

But Kennedy also insisted that in doing the work, “I am living up 100 percent to the spirit and the intention of the conflict laws.”

Kennedy has a lengthy list of credentials as a Democrat and is a former head of the California branch of the National Abortion Rights Action League. She invited scores of top politicos to her 1999 commitment ceremony with her longtime partner in Hawaii. After serving as a top Davis adviser, Kennedy was named to the Public Utilities Commission.

Kennedy dismisses the argument that even her former boss Davis — the subject of a recall election in part for his aggressive campaign fundraising — had a firewall that prohibited gubernatorial staffers from doing such campaign work.

“What did that buy Gray Davis?” she asked. “It gave him the worst reputation as a pay-to-play governor in the history of modern politics.”

The former Democratic governor “had such a thick wall between the campaign people and the government people,” she said, “that the government people did not know — when they were presenting a bill to the governor — that there was a fundraiser (on that issue) the next night.”

Kennedy’s defense of her salary arrangement has sparked criticism from activists of both parties who already had blasted Schwarzenegger for her appointment.

Steve Frank, publisher of the influential California Political News & Views, a conservative GOP Internet newsletter, reported last week that Republicans will debate at their state convention later this month whether to withhold their endorsement of Schwarzenegger’s re-election because of Kennedy’s involvement in his campaign.

“My concern is that it gives ammo to the Democrats,” Frank said last week. “They threw Gray (Davis) to the dogs; Susan was his chief partner in his pay-for-play schemes, and now she’s back at it. Has she done anything wrong? Probably not. Does it look bad? Absolutely.”

Political watchdog groups on the left agree.

“What’s amazing is that you’ve got a situation where Schwarzenegger has become worse than Gray Davis,” said Doug Heller, who runs the ArnoldWatch Web site on behalf of the Foundation for Taxpayer and Consumer Rights. “It’s almost like a Schwarzenegger movie where the hero kills the villain — and takes over his personality.”

Kennedy’s double dipping, he said, should underscore the need for “a law in the Legislature that nobody being paid taxpayer money should be allowed to work for a campaign on the side.”

Kennedy, however, adamantly insists she has crossed no ethical boundaries.

“I don’t do fundraising,” she said. “And you betcha, I’m going to work day and night, every free hour, to help get him elected. I believe in this man, I believe in what I’m doing.”

But this campaign work is strictly “on my own time. I’m talking to voters; I’m talking to newspaper editorial boards. And whenever I’m doing something, that is meeting with or addressing campaign people … I go off the state payroll and use my vacation time,” she said. “So there’s absolutely no conflict.”

Still, “you cannot avoid the appearance of conflict,” she argued. “If I’m out selling the governor’s plan, I’m talking to potential donors … every voter in this state is a potential donor.

“The conflict comes when you have direct income and you’re lobbying on a bill. I don’t lobby. I’d be giving the governor advice, regardless of who is supporting him or not.”

But Garry South, the former chief strategist for Davis, calls her defense “utterly and completely disingenuous.”

For the governor’s chief of staff to campaign for him at the same time she advises him simply “is not appropriate,” said South, who worked closely with Kennedy in the former administration and now advises Steve Westly, the Democratic state controller who is running for governor.

South says Kennedy, of all people, knows that “there is no free time” on which to do campaign work, because “the governor’s chief of staff is a full-time job.”

Karen Getman, a former chairwoman of the state Fair Political Practices Commission who has taught ethics at UC’s Boalt Hall School of Law, also said Kennedy is inviting trouble with the arrangement.

Kennedy’s situation directly conflicts with ethics guidelines issued and taught to elected officials and political staffers in Sacramento during the Davis administration — and even this year, Getman said.

Getman’s law firm, Remcho, Johansen and Purcell, has been hired to teach such ethics rules to lawmakers, and has distributed a handbook to state officials that warns that “state employees on official business should avoid discussion about campaign contributions or fundraising,” and any actions that “create the appearance that an official action is connected, in any way, to a political contribution.”

Instead, “between what’s happening in Washington and the Schwarzenegger administration, it’s as though (Watergate) never happened,” Getman said.

Bill Whalen, a senior research fellow at the Hoover Institution at Stanford who has advised Schwarzenegger and former Republican Gov. Pete Wilson, noted that previous gubernatorial staffers such as Wilson’s top aide, Bob White, also worked on the campaign.

“If Arnold is going to get kicked out of office, it’s because people don’t think he’s up to the job. (Voters) won’t say, ‘Damn it, I’m not going to vote for him because Susan Kennedy got $25,000,’ ” Whelan said.
E-mail Carla Marinucci at [email protected]

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