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Apr 25, 2007 - 03:45 PM

Arnold Knocks State Farm Off the $ Wagon

by Carmen Balber
Arnold reported raising $512,500 in new campaign contributions over the last two weeks leading up to today's high-priced fundraiser at his Brentwood mansion. The contributions include a $25,000 gift from State Farm Mutual Auto Insurance Company that could buy the insurer entrance to tonight's soiree, but breaks the company's long-standing practice of not giving to politicians.

The company ban on making donations to politicians was explained last December by a lobbyist in the insurer's Florida branch: "The money belongs to the policyholder. They don't believe it is appropriate to pick sides…" in campaigns.

Though many State Farm executives and agents have donated to Schwarzenegger in their personal capacity, this is the first corporate contribution to a candidate in California by the nation's largest insurance company.

State Farm's contribution went to Schwarzenegger's California Recovery Team, a general purpose committee, which "exists to help the Governor accomplish his ambitious legislative and issue agenda." The committee is not dedicated to the support of specific ballot measures, and has been known to pay for Schwarzenegger's travel and other expenses.

A cocktail reception fundraiser for Schwarzenegger's committee is scheduled for this evening at the governor's Brentwood home. If given for tonight's event, State Farm's $25,000 contribution places it at the Silver level and earns a spot on the Recovery Team "Advisory Council," including four private meetings with Schwarzenegger and "regular conference calls with the Governor and leading and well-known Californians from the public and private sectors."

Maybe State Farm was compelled to break its long-standing policy against donating to politicians because none has ever offered such a direct trade of campaign cash for political access. $25,000 for a year of in-person meetings with the governor and insider phone calls sounds like too good a deal to pass up. But State Farm is spending policyholder money to buy that access. The insurer should ask the governor to refund the money, and recommit to its no-contribution promise.

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