Who Will Be California’s Next State Treasurer?

from Ben ChristopherCalMatters

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Sale of bonds. Provision of tax credits. Supervision of pension funds. Investing idle money for maximum return.

These are the roles of a treasurer in California, a job that awakens someone with a penchant for green shades and a favorite Excel function.

But in California – as in most other countries — that’s a job that goes to a politician.

This may leave voters wondering: What is the best combination of skills, experience and values ​​for such a highly precarious job?

Ask the six candidates and you’ll probably get six different answers.

California’s next chief financial officer should be a detail-oriented former diplomat, according to Lt. Gov. Eleni Kounalakis.

For state Sen. Anna Caballero, Kounalakis’ primary Democratic challenger, the better option is a handpicked labor official with experience running a government bureaucracy.

The two Republicans, Jennifer Hawkes and David Serpa, believe it should be someone willing to curb the fiscal impulses of California’s overwhelmingly Democratic pol.

Board of Equalization member Tony Vasquez thinks a longtime elected tax commissioner is a good fit. Glenn Turner, a former crystal and tarot card seller turned mental health activist, believes the role calls for someone with a radical political vision.

Even turn-of-the-century Governor Hiram Johnson, one of the political founders of modern California, didn’t know what made a good state treasurer. The work, he complained to the Legislative Assembly in 1911, was “just clerical” and his “qualifications naturally cannot be well understood”.

The June 2 race is largely a contest between top Democrats.

Kounalakis v Cabayero

There aren’t many reliable public polls, but measured by name recognition, high-caliber endorsements and available campaign cash, this is Kounalakis’ race to lose.

That’s partly because of her current role as lieutenant governor, a job that requires a household name and management experience, even if the list of responsibilities is relatively short.

Kounalakis’ personal wealth also certainly helped make her a top contender. The daughter of developer Angelo Tsakopolous, founder of Sacramento-based AKT Development Corporation, she has nearly nine times more money in her campaign account than the other five candidates combined.

Kounalakis entered Democratic politics as a major donor, helping it secure an ambassador to Hungary under President Barack Obama. Those fundraising connections have also paid off this cycle: She’s backed by former First Lady Hillary Clinton, former US Speaker Nancy Pelosi and Gov. Gavin Newsom.

Kounalakis would not be the first to take this route to the treasurer. Phil Angeledes, who served from 1999 to 2007, is also an AKT alumnus whose political career was partially financed by Tsakopolous.

Although Kounalakis originally ran to replace Newsom as governor, she moved on to the lower-profile treasurer’s race last summer amid poor prospects in a crowded field. But Kounalakis, whose campaign did not respond to interview requests, has since argued that her background as a developer and her self-proclaimed technical orientation made the treasurer role more appropriate. She told the San Francisco Chronicle that she craved a technical role after so many years as a diplomat “standing at the podium with a visiting dignitary.”

Kounalakis’ decision was an unwelcome development for the state senator. Anna Caballero. A longtime state legislator who served as secretary of the Business, Consumer Services and Housing Agency under former Gov. Jerry Brown, the Merced Democrat was the presumptive front-runner until then. Cabayero has the upper hand on at least one count: She has raised more money than Kounalakis since the start of this year, even if her campaign account is smaller than the war chest the lieutenant governor has amassed over the years.

Both Kounalakis and Caballero have been removed from their current roles.

The race between the two top Democratic hopefuls is fierce, though they don’t seem to have much in common.

Both want the state to simplify the application process for affordable housing subsidies — which is already being worked on with the governor new housing agency. Both support the treasurer’s recent initiatives to direct state funds to renewable energy projects and to administer retirement savings program for workers whose employers do not offer retirement or 401k accounts. Both expressed enthusiasm about a proposal require state banks and other financial institutions to make more loans in lower-income neighborhoods and communities.

Where there is daylight between the two, it’s more a matter of emphasis than major disagreement. Caballero, for example, fervently promotes the use of hydrogen and milky gas as alternatives to gasoline and said the treasurer could encourage private-public partnerships in those industries. As a member of the State Lands Commission, Kounalakis is an ardent advocate of offshore wind development.

Who will make the first two?

Although Kounalakis and Cabayero are the two most feared candidates, it is far from certain that either will make it to the ballot in November. One of the top two seats could easily go to a Republican under California’s system, in which the top two vote-getters advance.

The California Republican Party is doing everything possible to make that happen. The California Republican Party has officially endorsed Jennifer Hawkes, a Bay Area party activist and former private school administrator, over Republican David Serpa. Reform Californiathe conservative Republican-run fundraising and voting organization Assemblyman Carl De Maioalso supported her.

“There is a risk of splitting the vote,” De Maio noted in a live chat with the Hawks. “We need to make sure we have someone in the general election that we can be proud of.”

What does the treasurer do?

Day-to-day work is mostly done by professional staff and doesn’t change much with changes at the top. This doesn’t give their chosen boss much room for creativity or innovation. Bill Lockyer, state treasurer between 2007 and 2015, said the job’s primary role is to ensure that work is done with Californians in mind — that “professional staff govern responsibly.”

However, sometimes there are opportunities to do more with work. Lockyer indicated his decision to invest in international renewable energy projects through the World Bank – a first for the state — as one of his most important achievements. When Angeledes was in office, he used the treasurer positions on the boards of the two major public employee pension funds to sue investment banks and defend shareholder rights. Other Democratic treasurers have acted as fiscal foils to Republican governors.

Since the days of Hiram Johnson, the post has sometimes been derided as a sinecure for career politicians waiting for their next move.

That, Cabayero said, is definitely not why she wants to be treasurer. Pointing to her work on housing policy and rural economic development, she said everything in her legislative career “has been about what’s in the treasurer’s office.”

Adding a not-so-subtle sod to Kounalakis: “I’m not on the cusp of anything else.”

Not that the treasurer’s office has been a particularly effective springboard: Angeledes, Kathleen Brown and, most recently, John Chang, all of whom have tried for treasurer, are running for governor. No one made it.

This article was originally published on CalMatters and is republished under Creative Commons Attribution-NonCommercial-No Derivatives license.