The Shelley show

A cascading series of investigations reveals the secretary of state used his status to create a partisan fiefdom—with himself as king. Why’d he do it?

Illustration By B.Z.

Eighteen months ago, as recall fever began to spread, a consultant for construction-related unions told me to watch for bad behavior by Secretary of State Kevin Shelley.

According to this consultant, Shelley was the most partisan Democrat the consultant had known in some time. He was alarmed that Shelley was joined at the hip to government labor unions that didn’t give a rip about California’s fiscal and jobs crisis, because government jobs and benefits metastasize even in bad times in California.

Shelley, raised in the hard-left politics of San Francisco, is the son of late San Francisco Mayor Jack Shelley, a deeply partisan labor politico. The younger Shelley acquired from his family a swagger and something of a “to the manor born” style. As a San Francisco County supervisor, and then in 1998 a new state assemblyman, Kevin Shelley was known among insiders as a cad who verbally attacked his staff during vicious, personal rages.

Some California construction-union honchos, while publicly backing Davis, privately hoped the recall would succeed, because Davis kept signing laws that crimped jobs. They worried that Shelley—elected state election czar in 2002—might do something sneaky using state election rules to save Davis.

Intrigued by this tip, I watched Shelley for possible misbehavior. Although he certainly didn’t fight on behalf of the recall effort, I did not see Shelley engage in dirty tricks. After Arnold Schwarzenegger became governor, I forgot about the terse warning I’d heard about Shelley over a cocktail.

Instead, I began quietly comparing Shelley to Controller Steve Westly. They had a lot in common. Elected just like Shelley to a powerful statewide job, Westly also was a handsome, engaging Northern Californian of the same generation as Shelley.

But Westly, a non-politician who made a fortune as a co-founder of eBay, quickly began outshining the politically more experienced Shelley. It was Westly, not Shelley, who emerged as the most appealing Democratic leader in Sacramento.

After all, it was a new day. Shelley appeared to suffer from an inability—drummed into him over a lifetime in San Francisco politics—to think or behave in anything but a hard-core partisan way. And that, I suspect, is at the core of the scandal now threatening to dash Shelley’s job and political career.

In the Capitol rotunda early this year, I ran into Richard Katz, a Gray Davis adviser. A moderate Democrat and straight-up guy, Katz is a former Assemblyman for San Fernando Valley and a veteran of political wars. Katz told me that Democrats in Sacramento were stubbornly resisting the recall message: that profligate overspending had condemned Davis and damaged the Democrats.

Katz hoped Democrats would “work with Schwarzenegger—for the good of the state and the Democrats.” This was hardly a singular view. We heard the same from Democratic Oakland Mayor Jerry Brown, who refused to flinch from the recall, saying, “Democrats did this to themselves, and they need to adapt.”

Controller Westly adapted adroitly. He worked closely with Schwarzenegger on passing the bond-measure bailout last spring, among other efforts. He even got in trouble with Democratic legislators who in a meeting called Westly out for being too willing to work across the political aisle. (I mean, there ought to be a law.)

Secretary of State Shelley, meanwhile, was quietly carving out a starkly different niche from Westly, as we now know. While belittling his own staff, as reported in juicy detail by The Sacramento Bee in the past month, Shelley was crafting a partisan fiefdom—with himself as king—apparently improperly funded by federal taxpayer election funds.

The first hints of it came in August, after a tipster called the San Francisco Chronicle to complain that Julie Lee, a city civic leader with ties to Shelley, had received big state grants to build a community center that was never built. The newspaper reported that a six-figure sum had shown up in Shelley’s campaign chest, apparently via Lee.

The Chronicle story set off a cascading series of investigations by Northern California papers. Now, each week brings more scandal and bad news for Shelley as newspapers begin to demand his resignation.

Among the revelations thus far are these:

A Shelley aide told state election workers that part of their government job was to find people to raise money for Shelley’s political campaigns. One election worker, Dawn Mehlhaff, felt the order was so grossly partisan that she demanded a job reassignment. (Bee)

The FBI is investigating whether $125,000 donated to Shelley in his 2002 campaign was illegally diverted from a state grant Shelley helped Julie Lee to obtain. (Chronicle)

A former aide says Shelley took a $2,000 contribution from a businessman in Shelley’s government office—which is illegal. The businessman, Suresh Patel, confirmed the handoff, saying there was “nothing wrong” with that. (San Jose Mercury News)

Now, Shelley has hired a private investigator to investigate himself and his office. This ridiculous misstep has given California GOP spokeswoman Karen Hanretty the opening to declare, with some believability, that Shelley is really trying to “investigate his staffers, who are talking to the media.”

What on earth was Shelley thinking? Why would anyone put his entire political career at risk using taxpayer funds on partisan activities, promoting some weird Cult of Personality starring himself?

That’s not easy to answer. These sorts of scandals usually crop up when there’s a razor-thin political war under way.

No such conditions exist in Shelley’s world. The Democrats still own the state of California, with voter registration among Democrats eight points ahead of that among Republicans. Republicans have gained some new voters under Schwarzenegger, now that the California GOP has been wrested away from right-wingers who did a disastrous “Newt Gingrich” number on their own party.

But Shelley knows Republicans aren’t a threat. President George W. Bush trails Senator John F. Kerry here by double digits, and incumbent Democrat Barbara Boxer is a shoo-in against Republican Bill Jones for U.S. Senate. The Sacramento Legislature has been controlled by Democrats since 1958, except for during a handful of years.

Republicans hope to regain a few Assembly and Senate seats on November 2. But even if Republicans miraculously win all six potentially close races, they’ll still be greatly in the minority in California’s Legislature.

Having paralyzed himself with scandal, Shelley now seems to be failing in his basic duties. In the farthest southern reaches of California in Imperial County, which is part of the 80th Assembly District of Republican Bonnie Garcia of Cathedral City, Garcia and her staff have discovered hundreds of bizarre sets of “twins” who are eligible to vote on November 2.

Like a tale from some corrupt Central American country, the “twins” live in the same household, often give slightly different birth dates from one another, and often have almost identical names. Said Garcia, “We found these double names—and I’ll use my own name, not the real names of people we are seeing—but it will be like ‘Bonnie Cortez Garcia,’ and then at the same address, a second voter will be registered as ‘Bonnie Garcia Cortez.’”

Garcia, who shocked Sacramento insiders by winning the mostly Democratic 80th District in 2002, wants election officials to investigate and purge the probably fake “twins” and other double-registered voters, who include Republicans and Democrats alike. But, Garcia said, county election officials won’t act “without instructions from Secretary of State Shelley, who has failed to respond.”

Now, the Chronicle reports another scandal in the 80th District: Shelley funneled federal voting act funds to Democrat activist Primitivo Castro, thus allowing Castro to run a slick “Democratic voter registration drive” against Garcia. It gets worse. The paper reports that Eric Jaye, a Shelley political consultant, is directly managing the pitched campaign launched by Garcia’s 80th District Democratic opponent.

The smell is getting intense. Shelley spokeswoman Carol Dahmen said Shelley has been “aggressively investigating” the twins problem and other 80th District oddities since early October. “We have made it a priority in the Elections Office,” she insisted.

Yet, who can trust Shelley, given what we’ve learned about Shelley’s apparent use of federal voter education funds in several communities to sign up scads of Democratic voters—but rarely to sign up Republican voters?

Democrats want to oust Garcia because she’s an up-and-coming, bilingual, Republican Latina who is attracting Latinos to the Republican Party. The lively Garcia is certainly fair game for other Democrats to tackle. But the secretary of state should never, ever, be involved in manipulating elections. The last thing California needs is a male version of the former Florida secretary of state.

Ironically, when Shelley was in the Assembly, he had a field day with Republican Insurance Commissioner Chuck Quackenbush, who resigned in July 2000 after accepting some $8 million in donations from insurers. Shelley pushed hard for bills to curb campaign giving to such state regulators, and also to open government documents such as those Quackenbush had refused to share with a legislative oversight committee.

Shelley harrumphed and put on quite a show about cleaning up after Quackenbush. Emphasize the word show.

This gets us to the “Why?” of the Shelley disaster. He had a grand future in mind—perhaps senator or governor. Like everyone scrambling for the political top in California, Shelley knew that the guy who doled out the most political favors to his own party could improve his chances of getting nominated. So, that’s what Shelley did.

Yet, Shelley forgot one rule: In politics, you can be a complete jerk to staffers and others, and you can viciously claw your way up. But you can’t pay for your ride on the public’s dime.