Schwarzenegger ad takes on gaming tribes
Tuesday, September 23, 2003

After declaring that he wanted to earn the support of California's politically-connected tribes, actor Arnold Schwarzenegger on Monday debuted an ad accusing them of not paying their "fair share" to the state.

In a 30-second television spot, Schwarzenegger says gaming tribes "make billions, yet pay no taxes and virtually nothing to the state." "Other states require revenue from Indian gaming, but not us," he adds. "It's time for them to pay their fair share."

Schwarzenegger, considered the leading Republican in the recall race, goes on to accuse rivals of pandering to Indian Country. Although he doesn't mention anyone by name, the critique is largely directed at Lt. Gov. Cruz Bustamante (D) and Republican state Sen. Tom McClintock, who have been the sole beneficiaries of tribal donations in the campaign.

"All the other major candidates take [tribal] money and pander to them," Schwarzenegger declares, noting that tribes have spent $120 million on state politicians and public campaigns in recent years(*). "I don't play that game."

"Give me your vote and I guarantee you things will change," he concludes.

The ad came as a state court ordered Bustamante to return more than $2 million he accepted from three gaming tribes. "Cruz Bustamante has been skirting and violating the campaign finance laws passed by the people of California, and today was judgment day," Schwarzenegger said in response to the decision.

Schwarzenegger has already drawn the anger of tribal leaders by referring to them as "special interests." He later tempered his views by asserting that he "always had a good relationship" with tribes and noted that he accepted $62,000 in donations from them while campaigning for a state initiative to fund after-school programs.

But the ad is not likely to generate the support he has said he wants from tribes. "I want to have their endorsement," he told The San Bernardino Sun. "But I don't want them to pay for it."

The ad is not entirely accurate either. While tribes with casinos took in $5 billion last year, they are required to share revenues under compacts signed by Gov. Gray Davis (D) and approved by the federal government. Tribes contribute about $130 million to the state's coffers every year.

And while it is true that tribes, as sovereign governments, do not pay taxes, they overwhelming majority of the 600,000 Native Americans in the state pay all state and federal taxes. Very few are exempt from state taxes.

Tribally-owned businesses are also required to collect state taxes on the sale of goods to non-Indians. The only exception is for services and products generated entirely on the reservation, a position recognized by the state after it was faced with losing a court case brought by the Agua Caliente Band of Cahuilla Indians.

Schwarzenegger has not met with any tribal leaders since the start of his campaign, although he said he was seeking a meeting. Tribes have been active players in the election, spending more than $5 million for direct contributions, focus groups, advertisements and support committees.

Bustamante has received the most backing, with McClintock coming in second. Davis, in earlier campaigns, took in the most tribal money of any candidate in state history.

The tribal involvement has drawn criticism from some of the candidates in the race, mostly independent Arianna Huffington, who said Bustamante was "abusing" campaign finance laws by accepting tribal money. Some newspapers, notably The Los Angeles Times, The Sacramento Bee and the opinion pages of The Wall Street Journal, have questioned the extent of tribal influence in state politics.

Of the more than 100 federally-recognized tribes in California, fewer than half offer gaming. Many of the tribes are small and located in remote regions.

*Ed Note: Based on numbers supplied by California tribal leaders, tribes spent $92 million of the $120 million on ballot initiatives. The rest went to state politicians. An earlier statement that all the money went to politicians is inaccurate.

Relevant Links:
Cruz Bustamante, campaign site -
Lt. Gov. Cruz Bustamante -
Arnold Schwarzenegger -
Arianna Huffington -
Peter Camejo -
Tom McClintock -
Fair Political Practices Commission -

Related Stories:
Opinion: McClintock throwing race to Bustamante (09/19)
Schwarzenegger: Tribe interfering with election (09/19)
Calif. tribes have spent $5M on recall race (9/18)
Calif. tribe hosts dinner for Republican candidate (9/15)
WSJ Opinion: Bustamante's 'extreme' tribal agenda (9/12)
Schwarzenegger seeks Calif. tribes' endorsement (9/12)
Two tribes support Republican in Calif. recall (9/11)
WSJ opinion-maker: Democrats bowing to Calif. tribes (9/8)
Bustamante to shift $3.8M in tribal and other funds (9/8)
Bustamante stood with tribes long before gaming (9/8)
Suit filed over Bustamante's tribal contributions (9/5)
Editorial: Bustamante should return tribal money (9/5)
WSJ opinion-maker: Democrats bowing to Calif. tribes (9/8)
Schwarzenegger to tribes: You've got voicemail (9/5)
Bustamante hit for donations from tribes (9/4)
Viejas Tribe spending $2M to boost Bustamante (9/3)
Pechanga Tribe donates $500K to Bustamante (9/1)
Schwarzenegger says tribal consultation 'misguided' (9/1)
Editorial: Schwarzenegger right about special interests (9/1)
Editorial: Bustamante on the take from tribes (8/29)
ICT: Vote NO on recall but YES to Bustamante (8/29)
Calif. recall candidates seek tribal support (8/29)
Calif. tribes to host three recall candidates (8/28)
Schwarzenegger won't take money from tribes (8/27)

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