`Duke Has To Be Stopped'

Just days before Louisiana's Nov. 16 gubernatorial election, employees of Stewart Enterprises, a New Orleans-based funeral home and cemetery operator, will get an unusual memorandum from Chairman Frank B. Stewart Jr. It warns that the election of Republican David Duke, a 41-year-old former Ku Klux Klan leader and Nazi sympathizer, could cripple the fragile state economy. "The major financial institutions in this country . . . will probably blackball us merely because of the reputation (be it right or wrong) that David Duke brings with him," Stewart writes. The stark choice: Back former Democratic Governor Edwin W. Edwards, whose years in office were marred by corruption charges, or risk "economic suicide" at the hands of Duke.

As Louisiana's bizarre governor's race reaches its climax, appeals such as Stewart's are becoming more common. Kevin P. Reilly Sr., chairman of Lamar Corp., a big outdoor advertising company based in Baton Rouge, plans to give his 400 Louisiana workers a similar message next week. "Duke has to be stopped," he says. Adds Baton Rouge retailing executive Donna Sternberg: "With our history of leaving Germany in 1936, the Sternberg family is vividly aware of the consequences of letting a tyrant rise."

Louisiana executives have mounted one of the most intensive political drives in recent memory. Some, like Republicans Stewart and Reilly, are drafting employee letters or sponsoring Edwards fund-raisers. Others, such as French Quarter business leader David Dixon, are funding ads that depict Duke's crusade against big government, welfare chiselers, and affirmative-action hiring as racial and economic poison.

BUSH WHACK. With Duke now running neck and neck with Edwards (table), business is petrified. "The only businesses that would benefit if Duke wins," says James R. "Jim Bob" Moffett, CEO of minerals giant Freeport-McMoRan Inc., "would be airlines and U-Haul companies" carrying the fleeing hordes out of the state. President Bush seems to agree. On Nov. 6, he added his voice to the anti-Duke chorus, calling the renegade Republican "an insincere charlatan."

Fear of a Duke victory has led the Louisiana Council for Fiscal Reform, an umbrella group that Moffett heads, to issue its first endorsement -- for reformers' nemesis Edwards. The ex-governor has also been endorsed by groups of lawyers, manufacturers, and merchants. Says Wiley McCormick, president of the New Orleans Tourism Marketing Corp.: "Tourism is a $3 billion industry here. Duke's election would be a disaster."

Just how big a disaster is in dispute. The Edwards campaign is hyping the economic doom message in hopes of winning over the upscale, better-educated voters who detest Edwards. According to University of New Orleans economist Timothy F. Ryan, a consultant to the anti-Duke coalition, a Duke victory might cost 45,000 jobs and $1.8 billion in annual revenues. Edwards is hammering hard at the job-loss issue. A recent TV spot shows workers ambling past a padlocked plant gate while the voice-over intones: "Unless Edwin Edwards is elected governor, Louisiana's shaky economy could collapse."

TOSS-UP. Actually, Louisiana has been making a comeback from the 1980s oil bust. Although the state lost 150,000 jobs from 1981 to 1987, unemployment is now 6.8%, about average. "Nobody expects a company like Exxon to pull out its refinery under Duke," says James A. Richardson, a Louisiana State University economist. "But business worries about future plant-siting decisions."

Business may have a more immediate problem handling a pro-Duke backlash. "Melina" -- she won't reveal her last name -- is a Duke backer working at a New Orleans energy company. She's upset about management's attempts to influence her vote. "I got a letter in my Monday pay envelope telling me, in effect, I should not vote for Mr. Duke," she says during a furtive phone call. "I was very offended. I wouldn't vote for Edwards if they threatened to kill me."

Can business turn the tide against Duke? Most analysts say the race is a toss-up, with Edwards' 28% share of the white vote below the 34% margin he needs to win. Whatever the outcome, though, business has cast its lot: Faced with a choice between a discredited former governor and a rabble-rouser who only recently cast aside his bedsheet, business will rally behind Edwards. Says Bill Little, president of the Baton Rouge Chamber of Commerce: "Given the choice, there is no other choice."

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