What Does Meg Whitman’s $120 Million Really Buy?

THE MIDTERM ELECTIONS
Meg Whitman says she’s running for governor of California to bring a sense of fiscal responsibility to Sacramento. But Whitman’s own campaign isn’t exactly what you’d call frugal. The former eBay CEO turned Republican politico has already pumped about $120 million of her estimated $1.3 billion personal fortune into the race. Stop to think about that number: $120 million is enough to buy a half-dozen F-16 fighter jets and about 25 Ferraris—and still grab Christie Brinkley’s recently listed $16 million five-bedroom home in the Hamptons. Even in the context of ever ballooning political spending, it’s huge money. Throw in the $25 million in donations, and Whitman has spent more than Al Gore’s entire 2000 presidential campaign did. She has shattered the previous spending record for a statewide California candidate ($78 million by former Democratic governor Gray Davis in 2002, money raised from thousands of donors). In mid-September, hers became the single most expensive nonpresidential campaign ever, surpassing the $109 million New York City Mayor Michael Bloomberg plowed into his 2009 re-election. With the election still a month away, some estimate Whitman could spend another $30 million or more.

(See “Meg Whitman vs. The Nurses Union.”)

Yet despite complaints that Whitman is simply buying the election, she hasn’t purchased much of anything yet. She finds herself in a toss-up—at best—with her opponent, attorney general Jerry Brown, whose campaign has spent all of $4 million, or about 3% of Whitman’s total. (Brown has raised an additional $30 million.) A recent Field poll placed the two in a tie at 41%. But a new TIME-CNN poll shows Brown with a handy 52-43 lead among likely voters. That would be a pretty meager payoff for Whitman’s massive outlay, even in a state where registered Democrats outnumber Republicans by about 10 percentage points and Brown is practically a household name, thanks to his four decades in state politics.

Whitman, by contrast, began her race as a complete political unknown. That’s why “she has saturated the airwaves,” in the words of Henry Brady, dean of the Goldman School of Public Policy at the University of California, Berkeley. But assuming Whitman’s money has bought her a fighting chance, it remains to be seen whether she can close the deal—or whether she will join the long list of failed millionaire (and some billionaire) candidates whose money couldn’t buy them political love.

Making Money Talk
Whitman’s advisers say her money isn’t nearly as important as her message: that California needs to slash state jobs to close its $19.1 billion deficit, lower taxes to spark the local economy and reform the state’s education system. Whitman casts herself as an independent above partisan politics. (She is a moderate whose conservative primary rival attacked her as “liberal Meg Whitman.”) Brown, Whitman says, is a relic from another era–a Big Government liberal in hock to the state’s public-employee unions.

Message is important, but a checkbook sure helps—especially in a state as large and expensive as California. And thus far, Whitman has spent smarter than some other profligate tycoons who notoriously carpet bombed the television airwaves with no clear strategy. As befits a tech CEO, Whitman has spent her money with a savvy that impresses strategists of both parties.

A prime example is her effort to reach out to California’s Latino population, estimated at 15% to 20% of the electorate. Faced with long-standing Latino suspicion of California Republicans, Whitman began advertising on Latino television and radio stations months ago. More recently, she has taken the unprecedented step of buying billboards and bus-stop advertisements in Latino communities. (“NO a la Proposición 187 y NO a la Ley de Arizona,” one declares—proclaiming Whitman’s opposition to Arizona’s tough new immigration-enforcement law and to a similar 1994 California ballot measure that was struck down by the courts.) “Republican candidates are never able to communicate to Latino voters because of how expensive it is” to craft a second campaign message in a different language, says Whitman campaign adviser Rob Stutzman. “So Latino voters for the first time are seeing a candidate spend significant resources to talk to them in Spanish-language media.”

(See “Meg Whitman Shatters Record for Self-Financed Campaign.”)

The targeting gets even more specific than ethnicity. The Whitman campaign uses “microtargeting” software that helps tailor mailings and phone calls to voters on the basis of not just traditional factors like party registration but also polling and purchasable consumer data like magazine subscriptions and car ownership. “If you’re a voter in California, it’s possible you have received 16 or 17 mailings by this time, all of them highly specific to you, with your name on them, talking about issues they know you care about—not just a generic ‘Vote for Meg Whitman.’ That’s never been done before in California,” says Garry South, a Democratic political consultant who ran two winning races for Gray Davis.

Also groundbreaking is a series of interactive television ads Whitman has been airing across the state. During the traditional pitch, a pop-up message appears on viewers’ screens urging them to press a button on their remote control if they want a free Whitman bumper sticker. The cable provider passes along the addresses of viewers who play along—which not only gets them a bumper sticker but also adds valuable new entries into the Whitman campaign’s voter-turnout database.

See questions for Meg Whitman.

Of course, there’s still plenty of old-fashioned spending—like the $10 million she had showered by June on consultants, including $90,000 per month to the firm of her top strategist, Mike Murphy. Whitman advisers note that Brown has been backed by a few million dollars in union advertising, with more likely to come. But even with the spending of outside groups factored in, Brown’s side could be outspent by more than 5 to 1. Indeed, Whitman’s spending on polling, information technology and office-related matters alone—almost $6 million as of June—exceeds Brown’s total budget so far.

But Is Anyone Listening?
The question is whether—and at what point—Whitman’s largesse might boomerang on her and turn off voters who are struggling to get by in a wheezing economy. One person who thinks that’s already happening is Chuck Idelson, spokesman for the 86,000-member California Nurses Association, which has been among Whitman’s harshest critics—thanks in part to her pledge to fire 40,000 state employees. Idelson calls Whitman’s campaign spending a “corruption of our political process” and says it explains why recent polls show an uptick in negative opinions of her (although the same is true of Brown). To drive home the point, the nurses’ union hounds Whitman with Queen Meg, a gown-and-crown-clad actress who parades around regally outside the candidate’s political events. On Labor Day, Queen Meg hit parades across the state, passing out pink slips with white-gloved hands.

(See “Races to Watch: Can the Republicans Make a Twin Killing in California?”)

Does it somehow contaminate the democratic process when a billionaire candidate swamps an opponent with campaign spending? Whitman, like wealthy candidates before her, says it’s just the opposite: that she is free from the influence of campaign donors and the kinds of interest groups backing Brown. “Meg will not be beholden to anyone,” says Stutzman. “Brown will be beholden to status-quo public labor unions.”

And despite the grousing about rich people buying elections, it’s not that easy. Just ask past presidential hopefuls like Ross Perot ($65.4 million in 1992) and Steve Forbes ($76.1 million in 2000). Or the conservative New York businessman Tom Golisano, who dropped $74 million on a governor’s race in 2002—and won 14% of the vote. In fact, the National Institute on Money in State Politics found that from 2000 to 2009, only 11% of some 6,000 state-level candidates who contributed at least half of their campaign’s spending from their own pockets ended up winning.

(See the best viral campaign ads of 2010.)

So far this year, however, big spenders have had some success. Yes, Florida Democratic Senate candidate Jeff Greene, a billionaire known for partying on his yacht with Mike Tyson, reportedly spent more than $23 million of his fortune on an August primary defeat. But also in Florida, businessman Rick Scott won a Republican gubernatorial primary after spending $50 million of his cash. And in Connecticut, pro-wrestling executive Linda McMahon spent $22 million successfully clobbering her opponent in the fight for a GOP Senate nomination.

But more ominously for Whitman, California has several notable entries on the list of self-funders who went nowhere: Democrat Al Checchi spent $40 million and landed 13% of the primary vote in his 1998 bid for governor, while Republican Michael Huffington spent $28 million on his 1994 Senate campaign, only to lose.

The lesson is that “you can’t spend your way into becoming a good candidate,” says David Donnelly, a campaign-finance reformer with the Public Campaign Action Fund. But many a good candidate doesn’t have the money to be heard.

(Read “Is California Sold on Governor Meg Whitman?”)

One solution: limiting how much money a candidate can give to her own campaign. The Supreme Court has already called that a violation of free speech, however, meaning it would require a constitutional amendment (not very likely) to change it. Other options include a system of public financing for cash-poor candidates—or, as many conservatives propose, an end to all campaign-finance limits. That way a candidate could accept huge donations from wealthy supporters to match Whitman’s personal largesse.

Congress has shown little appetite recently for major campaign-finance reform, but a Whitman victory could revive the debate. First, it remains to be seen whether this political newcomer and her avalanche of money can win one of the biggest jobs in American politics. “We’ve never seen anything like this,” says South, “so it’s very hard to make predictions.” If Whitman does prevail, who knows how the next record will be set? But there’s long been talk that Mayor Bloomberg may someday mount a self-financed run for President–an adventure that could easily cost more than $500 million. Even Meg Whitman might call that a lot of money.

See TIME’s White House photo blog.

See TIME’s Pictures of the Week.