Bush Steps Carefully Into State

President Bush arrives in California today to raise desperately needed cash for gubernatorial hopeful Bill Simon Jr., a routine visit that has turned into a political predicament for the White House.

Bush advisors have cringed at the prospect of an appearance by the president, who has professed zero tolerance for corporate wrongdoing, alongside a candidate whose family investment firm faces a $78-million judgment in a case involving alleged fraud.

So even as the president proceeds with the trip--amid feelings that he has little choice--the White House is working to contain any political damage by steering clear of the corporate ethics issue and limiting Bush’s appearances with Simon.

Democrats have been gleeful as Republicans squirm. Instead of Simon “getting hard time,” Bush “will raise him easy money,” taunted Bob Mulholland, political director of the California Democratic Party.

For his part, Gov. Gray Davis will further accent the corporate accountability issue today by announcing a series of steps aimed at cracking down on business misconduct.

National Republican strategists, already fretting over Simon’s candidacy, were blindsided last month when a civil jury in Los Angeles returned the multimillion-dollar verdict against William E. Simon & Sons, the family’s investment firm. The verdict, which Simon attributes to misguided jurors, left Bush with an unhappy choice: abandon the party standard-bearer in the nation’s biggest state, or appear alongside Simon at a time when Bush has tried to toughen his image as a corporate fraud-buster.

Ultimately, according to several people familiar with the president’s plans, it was decided that canceling the trip would exact a greater price than coming to California--particularly on a Friday in late August, when electioneering is hardly at the top of people’s minds.

“There’s a donor community, there’s a conservative cadre they want to keep happy, and they hurt themselves politically if they pull out,” said one Republican strategist who advised the White House on the trip and asked not to be named. “They’re going to try to do this under the radar as best as possible.”

To that end, Bush will appear without Simon at community forums in Stockton and Santa Ana, the events likely to draw the most news coverage, particularly outside California. Bush and Simon are to appear together at a luncheon fund-raiser in Stockton and an evening reception in Dana Point--where ticket prices have been slashed--with coverage limited to a handful of reporters. A third and final Simon fund-raiser, a private breakfast in a Westwood office tower, is scheduled for Saturday morning, just before Bush leaves the state for a campaign stop in New Mexico.

(A fourth Bush event, a private dinner Friday night in Dana Point, will raise money for the California Republican Party and its get-out-the-vote drive. The entire GOP ticket has been invited.)

To avoid potential embarrassment on his California swing, the president will avoid the issue of corporate responsibility, according to a second strategist who helped plan Bush’s trip.

More to the point, “You will not get the president standing up and declaring Simon’s innocence,” this Republican strategist said.

Asked about the Simon court case as he inspected a forest fire in Oregon on Thursday, Bush said only that Simon had expressed confidence that the judgment against his family firm ultimately would be overturned. “Bill Simon assures us that when the courts look at this case, he’ll be innocent, and I take the man for his word,” Bush said.

Despite Bush’s political bind--and Democratic efforts to embarrass the president by quoting his hard-line statements against corporate fraud--Simon aides expressed delight over the president’s visit. They said there was no evidence that the White House wished to distance itself from the GOP nominee.

“We talk to them daily,” said Sal Russo, chief strategist for the Simon campaign. “There’s never been one expression whatsoever of any hesitation at all. None. Zero.”

Simon’s fund-raising flagged immediately after the fraud verdict, but has lately picked up in advance of Bush’s visit. The GOP nominee hopes to collect between $3 million and $3.5 million from the president’s three stops. Earlier this year, Bush raised nearly $5 million for Simon during an April campaign swing, making the president the candidate’s single-biggest fund-raising asset, apart from Simon’s substantial family wealth.

In all, after Saturday, Bush will have made five fund-raising appearances for Simon, a sign, according to Russo, of his commitment to Simon’s candidacy. “I don’t know if they’ve even done five for Jeb,” said Russo, a reference to the president’s brother, who is seeking reelection as Florida governor.

But strategists close to the White House said pointedly that, once Bush leaves California on Saturday, he will have fulfilled his commitment to Simon. “Unless Davis craters and polls show [the race] even at the end of October,” the president plans no return visits, nor will he appear in any of Simon’s advertising, one GOP strategist said.

During a campaign stop Thursday in East Los Angeles, where he appeared alongside former New York City Mayor Rudolph Giuliani, Simon would not say whether his campaign had alerted the White House to his legal difficulties before the fraud verdict came down late last month. “We’ve been in constant touch with them every day,” was all Simon would say.

He also cast a positive light on the cut in ticket prices for tonight’s Orange County event, where prices have been slashed from $1,000 a head to as little as $250.

“We have volunteers who have been very supportive and worked very hard and could not afford to attend the event” at Dana Point’s swank St. Regis Hotel, Simon said. “We want to send the word out far and wide that we are a party that is going to be supportive.”

For all the tumult, Bush had little choice but to visit California this week, Republican observers said. For one thing, he had given his word. But there were strong political incentives, as well.

Many party conservatives remain touchy about Bush’s perceived favoritism toward former Los Angeles Mayor Richard Riordan, who was coaxed into the governor’s race partly at the urging of the White House. Riordan lost badly to the more conservative Simon in the March GOP primary, thanks in good part to a multimillion-dollar anti-Riordan advertising blitz by the Davis camp.

“To abandon Simon would be seen as a betrayal by the right,” said Marshall Wittmann, a political analyst with the conservative Hudson Institute, a policy think tank. “Nor can the White House afford to simply write off the largest, most populous state in the country.”

California has long been a vexing place for Bush, as it was for his father during the elder Bush’s doomed 1992 reelection effort. The junior Bush outspent Vice President Al Gore in 2000 by roughly $20 million and still lost California by 1.3 million votes, a margin that more than accounted for Bush’s trailing in the popular vote nationally.

Once he took office, Bush waited 3 1/2 months to pay his first visit. Today’s stop will be his fifth trip to California as president. On previous visits, Bush has courted swing voters in places like the Inland Empire, or sought to broaden his appeal by appearing in Democratic strongholds such as South-Central Los Angeles.

On this trip, Bush will do a bit of both, with stops in the Central Valley, home to many political independents, and an appearance with Latino supporters in Santa Ana.

While most political handicappers view heavily Democratic California as an uphill fight for Bush in 2004--a view shared at the White House--waging a competitive campaign here could improve his reelection prospects by diverting time and attention that the eventual Democratic nominee would rather spend elsewhere.

“Even if he loses California, if he does so by a narrower margin than last time, that helps him in the popular vote nationally,” said Jack Pitney, a government professor at Claremont McKenna College and former national Republican Party operative. “I’m sure that’s a consideration on the minds of Bush strategists.”

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Times staff writer Nicholas Riccardi contributed to this report.