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Peeved Housekeeper Is $119 Million Problem: Margaret Carlson

Since the continent shifted and everything not nailed down fell into California, many cultural phenomena have started there: right turns on red, the revolt against property taxes, casual Fridays, Lindsay Lohan’s meltdown.

Not all to the good, and neither is this one: Meg Whitman, the former chief executive officer of EBay Inc. (EBAY), set a record last week for personal spending on a campaign, reaching $119 million so far in her bid to be California’s next governor. After winning the Republican nomination, she promised to spend whatever it took to defeat her Democratic opponent, Jerry Brown.

Give Whitman credit. The election isn’t over yet and she has already kept that promise.

It used to be that self-financed candidates looked like Richie Rich: a little bit spoiled and a little bit bored. They had to explain buying themselves friends and votes. In the last nine years, according to the non-profit National Institute on Money in State Politics, only 11 percent of state and federal candidates who supplied the majority of their own campaign funds have won.

Profligacy is no longer a liability. To the contrary, corporate titans are the new outsiders.

Didn’t vote much before shooting for high political office? No big deal. That shows just how politically pure Whitman is. In this year’s toxic environment, to vote is to be incriminated in the election of the bums already in office.

Whitman has airbrushed the blemishes in her career, notably the black eye of having EBay overpay for Skype, the Internet telephone service.

Housekeeper’s Hit

Two days ago, she survived a rather bland debate with the more-skillful Brown. Yesterday she was hit with something that’s knocked others from government, including nominees of the last three presidents.

Nicky Diaz, Whitman’s housekeeper for nine years, came forward to say she has been in the U.S. illegally and claimed Whitman had to be aware of that fact while employing her.

Diaz’s lawyer, Gloria Allred, threw the kitchen sink at Whitman, describing her as an abusive employer, without offering proof. No matter -- the serious part here is hiring someone who turns out to be an illegal immigrant, since the employer has a clear obligation to demand proof of legal status.

When Whitman began her campaign for governor, realizing having an illegal alien on board was a liability, she terminated Diaz -- “throwing me away like a piece of garbage,” as Diaz put it. Whitman, in a statement, said she fired Diaz in June 2009 because that’s when Diaz “confessed that she was an illegal worker.” Allred said Diaz also is seeking back wages and unpaid reimbursement for expenses.

Impression Forming

Whatever the truth, the tale of Whitman’s housekeeper bolsters the impression that Whitman is not the gentlewoman she seems to be. The New York Times reported in June that an EBay employee who claimed an angry Whitman had forcefully pushed her in 2007 won a private settlement that may have reached six figures.

In the campaign, Whitman has shifted to the right on immigration, expressing sympathy for Arizona’s plight and subsequent crackdown. Diaz’s timing was impeccable: in the debate one night earlier, Whitman had said employers should be held accountable for hiring undocumented workers.

The hallmark of the multimillionaire candidate is to avoid uncontrolled situations, such as a debate, where your words can come back to haunt you. A sound studio is the self-funder’s preferred venue, 30 seconds the favored time limit. Whitman campaigns primarily by filming ads in a studio with a script and no pesky reporters around.

The Coming Ad

Watch for Whitman to whitewash the housekeeper issue with an ad featuring farm workers, all properly documented, with their children running out of an impressive-looking charter school in crisp uniforms at 3 p.m.

As with self-help and surfer music, California is at the center of a craze sweeping the nation.

Wisconsin Democratic Senator Russ Feingold, the champion of campaign finance reform back when Arizona Republican John McCain still copped to being a maverick, is now facing defeat at the hands of Ron Johnson, a businessman who spent millions to win the Republican nomination. In Florida, the former head of Columbia/HCA Healthcare Corp., Rick Scott, now the Republican nominee for governor, has so many ads up he’s begun the latest round with, “Me again.”

And back in California, Carly Fiorina, former Hewlett- Packard Co. CEO, has spent $5 million extolling her management skills, which included overseeing the outsourcing of thousands of thousands of jobs while the company upgraded its corporate jet fleet and she bought herself a yacht. The fortune she’s drawing on to fund her campaign includes the golden parachute she received after she was booted out.

Connecticut Apogee

In staid Connecticut, Republican Senate candidate Linda McMahon makes Whitman and Fiorina look like Rebecca One and Two of Sunnybrook Farm.

She made her money taking a stodgy wrestling operation and lit on the easiest way in America to get rich: selling porn. Hers was soft and involved family members acting out in the ring, a spectacle overshadowed at times by the taint of steroids and the continuing tragedy of wrestlers dying young.

President Barack Obama visited Connecticut to help the state’s Democratic attorney general, Richard Blumenthal, pull out a win over McMahon. It’s too close to call.

If Major League Baseball or the National Football League were looking for a new commissioner, they would surely shun McMahon. But voters looking for a senator? It’s a sad reflection on us all that money makes that possible.

(Margaret Carlson, author of “Anyone Can Grow Up: How George Bush and I Made It to the White House” and former White House correspondent for Time magazine, is a Bloomberg News columnist. The opinions expressed are her own.)

To contact the writer of this column: Margaret Carlson in Washington at mcarlson3@bloomberg.net

To contact the editor responsible for this column: James Greiff at jgreiff@bloomberg.net

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