Arnold Inc: Living Like a Star
(CBS 5) What do you do after you've amassed a
fortune estimated at $400 million? After you've married
into one of the most glamorous dynasties in America? After
you've taken up part-time residence in Sacramento, because,
oh yes, you've been elected governor?
Well, you keep living like a star. And nobody in
Sacramento, or anywhere in state politics, has ever seen
anything like "Arnold, Incorporated."
"There's a wide wake in Arnold's path," said State Sen.
Carole Midgen, D-San Francisco. "There's no question that
there's a lot of advance, a lot of entourage. One isn't
surprised to know you're in the presence of a global
But it's costly. Schwarzenegger commutes weekly from LA by
private jet. He lives in Sacramento in a $7,000-a-month
suite at the Hyatt Hotel. He travels with more CHP and
private security than any of his predecessors. And when he
has an event -- even a simple press conference -- the
lighting, sound and stage-teams sweep in hours beforehand
with the best equipment. Even the president of the United
States doesn't travel with his own Hollywood lighting
Now, some consumer watchdog groups are starting to ask
questions about who pays for Arnold, Incorporated, and
"The cost to the state of California having a movie-star
governor is extravagant," said Jamie Court of the
Foundation for Taxpayer and Consumer Rights. "We are
picking up hotel bills, we are picking up security bills,
there's all sorts of travel bills. Wherever this governor
goes he goes with a huge entourage. And if taxpayers don't
wind up paying for the entourage -- in most cases they
don't -- the special interest groups that are paying for
the entourage are getting some chits with the governor, and
they're getting a rate of return somewhere."
The Schwarzeneggers live in a gated community in the
Brentwood section of LA. The family has always had lots of
private security and they've always lived an A-list
Hollywood lifestyle. And he brings all that to the
So Schwarzenegger has set up half-a-dozen private political
committees to pay for the jets, the hotels, the travel, the
big events, the lifestyle -- and records show that funding
those committees with millions of dollars are some of the
biggest developers, insurance companies, financiers and
corporations in the State.
"Gray Davis set the standard until Governor Schwarzenegger
blew him out of the water," said Doug Heller, with the
Santa Monica public-interest group called ArnoldWatch.org.
"Gov. Schwarzenegger raises somewhere between $72,000 and
$80,000 every single day of the year. That's double what
Gray Davis did when Gray Davis was at his height of
fundraising... The donors, I think, have gotten more than
they would have dreamed up. Because you can look at a
number of different levels where Gov. Schwarzenegger has
served the corporate donors who have been contributing to
both his campaigns and these charitable groups."
As for the governor, his office notes that he's not taking
any salary to do his job. And he himself says his fortune
keeps him independent.
"No one can buy me," Schwarzenegger said. "I am
independently financially successful. I have enough money
that I don't have to take anyone's money to be bought. That
is the key thing."
But it's not so simple, when you look at the bills the
Governor has signed and vetoed, and when you connect the
dots to his contributors. And we'll press him on that, in
our next report.
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