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Some of INdTV's individual investors appear to have been scooped from the Gore 2000 all-star donor team. There's Indiana shopping mall magnate Melvin Simon and his wife, Brenda. Beyond each giving the $1,000 legal maximum to Gore for his White House bid, the couple shelled out $2 million in so-called "soft money" to the Democratic National Committee between 2000 and 2002, federal campaign records show. There's Albert Dwoskin, a commercial real estate developer from suburban Washington, D.C., and another longtime Gore backer, who gave the DNC $370,000 between 1999 and 2002. And there's Warren Lieberfarb of Los Angeles, the former head of Time Warner Video and a Friend of Al. He has tossed at least $87,000 to the Democrats since 1997.
Ownership percentages of INdTV have not been disclosed. An SEC filing lists Gore, Hyatt, and trusts set up for Hyatt's sons, Jared, 20, and Zachary, 17, as "beneficial owners," indicating that they are substantial stakeholders in the venture. But it is INdTV's other two significant owners -- the private equity funds Yucaipa Corporate Initiatives and Blum Strategic Partners, with their connections to CalPERS -- that are likely to raise eyebrows among those suspicious of the venture as a liberal antidote to right-wing media.
CalPERS, the nation's largest pension fund, has long cultivated a reputation as one of the good cops of the securities business, flagging corporate malfeasance and yanking investments from entire countries in the name of financial transparency. But critics have also accused its powerful 13-member board, which is dominated by organized labor and the state Democratic Party apparatus, of engaging in political cronyism that mocks the good governance principles CalPERS ostensibly promotes.
One such criticism -- that the handful of politicians who by law sit on the CalPERS board routinely accept campaign money from entities in which CalPERS invests -- is clearly applicable in the case of the Burkle fund that helped stake INdTV. In 2001 the CalPERS board voted to invest $200 million in Yucaipa Corporate Initiatives, part of an overall $560 million commitment to one or another of the funds managed by Yucaipa Companies. (CalPERS committed $50 million to the Blum fund that invested in INdTV, which is managed by Blum Capital Partners, the firm headed by Feinstein's husband.)
Among the CalPERS directors who approved the Yucaipa investment were state Treasurer Phil Angelides, then-state Controller Kathleen Connell, and then-San Francisco Mayor Willie Brown. All three had a long history of accepting campaign money from Burkle and Yucaipa Companies before the investment was approved. Brown's law firm was also paid to do legal work for Yucaipa after he left the state Legislature. Connell is no longer on the CalPERS board, having been replaced early last year by current state Controller Steve Westly. Although not on the board at the time the Yucaipa investment was approved, Westly also has accepted campaign money from Burkle since joining CalPERS.
Burkle's influence within Democratic Party circles can hardly be overstated. His A-list involvements include serving as a trustee of the J. Paul Getty Trust; as a board member of the Carter Center, founded by former President Jimmy Carter; and as a trustee of the John F. Kennedy Center for the Performing Arts. Since 1998, state records show, the one-time grocery chain magnate (Jurgensen's, Ralphs, Food 4 Less) has contributed more than $2 million to Democratic candidates and causes in California. More than $600,000 of that went to Gray Davis, who while governor held the authority to appoint four members of the CalPERS board.
In 2001, Golden State Foods, one of Burkle's companies, placed Davis' wife, Sharon, a former flight attendant, on its board. At the time the CalPERS board approved the investment in Yucaipa Corporate Initiatives, one of Yucaipa's partners was John Garamendi, who left the firm to become state insurance commissioner and who has received campaign money from Burkle and Yucaipa while in office.
Burkle's equal among the state's monied Democratic power brokers would be Blum, whose firm manages more than $3.5 billion in assets and who as the wealthy spouse of one of Washington's most influential Democrats enjoys almost limitless political connections. Blum gave more than $366,000 in "soft money" contributions to Democratic causes between 1999 and 2002 alone, records show, and has continued to give many thousands of dollars more to a slew of U.S. Senate candidates and political action committees up to the present. He's also long been a major donor to state Democrats. For example, he either gave or helped raise more than $250,000 for Gray Davis before Davis appointed him in 2002 to the Board of Regents of the University of California.
Earlier this year, Blum wrote a $100,000 check to the Media Fund, a pro-Democratic group formed to defeat President George W. Bush that is headed by Harold M. Ickes, former deputy chief of staff in the Clinton White House. Last month, when Clinton dropped into the Bay Area for a trio of book-signings for his autobiography, he found the time to speak to the American Himalayan Foundation, a nonprofit run by adventurer Blum out of Blum Capital Partners' Montgomery Street offices. Even Blum and Hyatt have reason to rub shoulders, each serving as trustees of the liberal Brookings Institution.
While declining to disclose the size of the Blum firm's investment in INdTV, Blum spokesman Owen Blicksilver insists that politics had nothing to do with it. "The investment went through a strict due-diligence process," he says. "The [Blum] partners would not have made this investment if they did not believe it had potential for a good return."