Head of bank bailout runs for California governor
SACRAMENTO, Calif. (AP) — Neel Kashkari, a former U.S. Treasury official who was the architect of the nation's bank bailout at the height of the recession, said Tuesday he is running for governor of California.
The Republican newcomer will face long odds against incumbent Gov. Jerry Brown, a Democrat.
Kashkari, an engineer by training, made the announcement during a speech at California State University, Sacramento. He cited the relatively poor performance of California's public school system and an unemployment rate that remains among the highest in the country as his main motivations for running.
"The status quo is unacceptable," he said.
He made his bid official after spending nearly a year meeting with influential policymakers and potential donors and studying California policy.
Kashkari, 40, an Ohio native and son of Indian immigrants, has no political experience and has never before sought public office. Still, he said he has long felt a calling to public service.
He has said that calling prompted him to approach Henry Paulson and ask to join him in Washington when Paulson was tapped to become U.S. treasury secretary under former President George W. Bush. Kashkari was working at Goldman Sachs in San Francisco at the time.
Under Paulson, he was soon asked to head the Troubled Asset Relief Program, in which the federal government helped prop up the country's major banks as the recession deepened.
Kashkari describes himself as a social moderate who supports gay marriage and abortion rights — positions that could be advantageous in overwhelmingly Democratic California. Republicans now make up less than 30 percent of the electorate in the state.
The state's new primary system, in which the top two vote-getters move on to the general election regardless of party affiliation, means he does not have to face the hard-right conservatives who used to dominate California's GOP primaries.
Kashkari outlined his political philosophy during an interview last month with The Associated Press.
"What I would want to pursue is the opposite of trickle-down economics, but it's empowering those at the bottom," he said. "So I think that the kind of solutions that I would come out with will strongly resonate with Republicans, and with independents and with moderate Democrats."
Kashkari joins Republican Assemblyman Tim Donnelly as declared major candidates in the race. Donnelly is a tea party favorite and gun-rights advocate who lives in the San Bernardino Mountains community of Twin Peaks.
Former Lt. Gov. Abel Maldonado, another Republican moderate, dropped his campaign last week.
Brown, a Democrat who enjoys strong popularity ratings among potential voters, has not yet declared his intention to run again but has amassed nearly $17 million in campaign contributions.
He poses a formidable challenge for any candidate, let alone one such as Kashkari who is untested on the campaign trail. Voters approved the governor's tax increases in 2012 and the state's economy is on the rebound, factors that have led to projected budget surpluses after years of multibillion dollar deficits.
Kashkari's role heading the Troubled Asset Relief Program from 2008 to 2009 is likely to be one of his biggest liabilities. His campaign team already has sought to blunt possible attacks, noting that the federal government has collected $435.8 billion from program recipients who initially were paid $422.2 billion.
Democrats have sought to portray Kashkari as the inexperienced architect of a program that helped bail out the rich.
"This is a Goldman Sachs banker who thinks giving hundreds of billions to Wall Street banks was more successful than the New Deal or the minimum wage," Dan Newman, a political spokesman for Brown, said last month.
While building a political platform centered on Republican themes such as reducing regulations and creating incentives to boost the economy and fix schools, Kashkari has sought advice from former Florida Gov. Jeb Bush, former Secretary of State Condoleezza Rice and the Hoover Institution. He has visited food banks and stayed overnight at a homeless shelter as part of his political education.
Although he does not have much of a track record for voters to study, Kashkari previously told the AP he would work to build relationships in the Legislature as he did in Washington.
"As I've studied Governor Schwarzenegger's tenure here, I think one of his struggles was he didn't invest to build those relationships with the legislators," Kashkari said.
During the December interview with the AP, he also acknowledged that he has had a somewhat spotty voting record. He said he missed some gubernatorial votes and did not vote in the 1996 presidential election, figuring that "Bob Dole didn't have much of a shot against Bill Clinton."
He also voted for President Barack Obama, a Democrat, in 2008, at the height of the financial crisis because of the superior economic advice he said Obama received.
Kashkari worked in the aerospace industry before opting to get an MBA from the Wharton School at the University of Pennsylvania.
He took a mental time-out after the stress of working in Washington, he said, before re-emerging to work for Newport Beach-based bond investment company Pimco until 2013, when he left to consider running for office..