Politicians split on effect of California governor’s recall on Nevada businesses

Dan Kulin

Wednesday, Oct. 8, 2003 | 9:40 a.m.

As Californians elected Arnold Schwarzenegger governor, Nevada politicians from both sides of the aisle headed to the Strip for separate fund-raisers Tuesday night.

Republicans at The Venetian to raise money for an anti-tax think tank said the California recall of Gov. Gray Davis was a referendum on high taxes and that state's budget woes.

Meanwhile Democrats at Harrah's for a Democratic Legislative Caucus fund-raiser said the California recall happened because people were upset and frustrated with a bad economy.

"A lot of people are looking for simple answers," Assembly Majority Leader Barbara Buckley, D-Las Vegas, said, adding that Californians are frustrated with the recession and recent energy crisis there.

"But is Arnold going to be able to terminate California's problems? I don't think so," Buckley said.

Assembly Speaker Richard Perkins, D-Henderson, said Californians are "just mad in general" over the bad economy and found in Davis someone to focus their anger on.

"But no matter what the outcome of the recall, California's economic woes won't be solved, and you'll see businesses moving to Nevada regardless," Perkins said.

Nevada Gov. Kenny Guinn this morning congratulated Schwarzenegger and said, "I know these have been challenging times in which to govern. Every elected official has been called upon to make difficult decisions that are not always popular. This was a matter decided by the voters of California."

Some Republicans interviewed at the fund-raiser for the Nevada Policy Research Institute said they think the recall will have a significant impact on Nevada.

"It would be the worst for Nevada if Arnold gets elected because Nevada benefits when California suffers," Assemblyman Bob Beers, R-Las Vegas, said.

Beers said that with Schwarzenegger as governor Californians would see less of tax increases, if any, than they would with Davis. This means that fewer businesses will consider moving to Nevada, he said.

However, Beers also said that an economically healthy California somewhat helps Nevada, because that improves the overall economic climate for this part of the country.

But Grover Norquist, president of Americans for Tax Reform, said Nevada's better off with a troubled California.

"It's a problem for Nevada if California gets its house in order," Norquist said. "California with a mildly competent governor won't be driving people out of the state."

Norquist also said he's concerned the hotly contested tax increases for Nevada set the state in the wrong direction and could scare away businesses.

"It's the direction of tax policy, not necessarily whether it's a high or low tax state," he said, adding that for this reason it's important to have groups such as the research institute and the 14 Assembly members who fought the tax increases to the end.

"We need serious people in the Legislature, and we need a think tank that steps aside and looks at this year and five years later," he said.

The fund-raiser brought in $50,000 for the Nevada Policy Research Institute, Executive Director Helene Denney said.

The amount raised by the Democratic fund-raiser was not immediately available this morning.

Sen. Terry Care, D-Las Vegas, said the fund-raiser was well attended by representatives from a variety of groups, including trial lawyers, health care, gaming and education.

The event was a chance to "re-establish relationships" with people who haven't seen each other for a few months, Care said.

Vincent Frey, a political consultant with the Southwest Group, said the Democratic fund-raiser was full of energy, which he attributed to supporters' aggravation with the Bush administration.

Perkins said as many as 400 to 500 attended the Democratic fund-raiser, which he said is a good indication of the confidence supporters have in the party.

"It's just awesome," he said.

Sun reporter Cy Ryan contributed to this story.