Dirty Dealings at a Tahoe Marina

By George Skelton

June 8, 2006 12 AM PT

Sacramento — To fully appreciate Phil Angelides’ triumph over Steve Westly, it helps to recall “The Godfather: Part II.” Near the movie’s end, Don Michael Corleone orders a hit on his brother Fredo at Lake Tahoe.

The exact spot -- the very same little marina -- was used by Westly in an attempt to whack Angelides. The dock where Fredo motored off with Corleone henchman Al Neri in a small fishing boat before being shot and dumped in the lake is where Westly’s ad-makers superimposed a dredger and accused Angelides of illegally dumping sludge offshore.

Westly’s accusation had about as much credibility as Michael’s claim to the Senate rackets committee that his family made its money off olive oil.

The movie was shot at the old Kaiser estate on Tahoe’s west shore in 1974. Later, the estate was sold and developed into a 22-unit luxury condo complex, Fleur du Lac. Angelides became an 11% partner in one unit.

Near the end of the gubernatorial primary, Westly tried character assassination, since nothing else seemed to be working against his brother Democrat. He implied that developer Angelides had dredged the marina illegally, dumped “a million gallons of sludge” into the pristine waters and was fined.

The truth is that Angelides was not a developer on the project, didn’t know about the dredging -- anyway, it was silt, not sludge -- and never paid a fine. The state attorney general sued every condo owner at the complex, including Angelides and his partners. But only the developer wound up paying.

Unlike Fredo, Phil survived. But the wounds were severe.

Westly smacked Angelides in the most vulnerable spot of a developer-Democrat: right in the environment. Fact is, Angelides has done some wetlands filling, but he’s also been a leader in “smart growth.” In a Democratic primary, many voters expect their candidates to be pure green.

Westly strategist Garry South says that the developer-soiling-the-environment ads were Westly’s most effective weapons at the end of the nasty campaign.

Angelides pollster Paul Maslin agrees. “That Tahoe ad hurt us a lot,” he says. “They scorched us.”

But the weapon also backfired on Westly. He jolted Sen. Dianne Feinstein, a longtime Tahoe protector. Calling the ad “dastardly,” she asked on the weekend before election day: “How could I ever trust someone” who would run such a spot?

There are some lessons here.

For one, the guy with the nastiest ad just might lose. Westly’s Tahoe fabrication was colossal sleaze -- or call it sludge. It crossed the line the furthest in a depressing contest that was notorious for mudslinging by both sides.

Second, this was a victory for geeks. Westly is the telegenic good-looker; Angelides the plain-Phil -- the anti-Arnold not only in policy but physique. An attractive face isn’t enough; the words being mouthed also must be appealing.

Third -- and how many times does this lesson need to be taught? -- it’s not enough merely to be so superrich that you can finance your own campaign. Nobody buys a high office in California. Not Michael Huffington, not Al Checchi, not Steve Westly.

Fourth, regardless of conventional wisdom, endorsements -- even if they don’t bring much money -- can mean a lot. In this race, they meant almost everything. Angelides’ endorsements by Sen. Feinstein, Sen. Barbara Boxer and House Minority Leader Nancy Pelosi -- combined with backing by the state Democratic Party and major labor groups -- stamped him with an official seal of approval. That swayed many voters.

Fifth, it helps to have rich friends when competing in this loophole-ridden campaign finance system that encourages circumvention of contribution limits through creation of “independent” committees. No candidate ever had better friends than two of Angelides’: developer-pal Angelo Tsakopoulos -- lead partner in that Tahoe condo -- and his daughter, Eleni Tsakopoulos-Kounalakis.

They rescued their former business partner’s campaign when he was too broke in April to afford television ads, donating $8.7 million to an independent committee of firefighters and cops seeking to promote Angelides on TV. Then they refused to talk publicly about it, a PR mistake. But on Wednesday the daughter was explaining.

“Phil’s a very old and very dear friend who we’ve known for decades,” Tsakopoulos-Kounalakis told me. “He’s a Greek American and he needed help.”

Tsakopoulos is a longtime Democratic donor who has bankrolled many Greek Americans.

One comment by Westly strategist South particularly motivated them, his daughter said.

“He called my father the ‘sultan of sprawl.’ It was the word ‘sultan’ that was offensive. Sultans were Turks. Greeks were subjugated by sultans for 400 years.

“It spread like lightning through the Greek community. People were outraged. It was the equivalent of calling someone who’s Jewish a Nazi.”

The most relevant lesson: Don’t count Angelides out in his race against Gov. Arnold Schwarzenegger.

He begins as the underdog, but is fired up and speaks with passion. He comes across as a candidate who truly believes in something -- in “leading a new progressive era in California.” Maybe voters are ready for that in what’s looking like a Democratic year.

In the movie, Fredo was the dumb brother. Phil is no Fredo.

George Skelton writes Monday and Thursday. Reach him at [email protected].