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Carl DeMaio

Tom Blair
Carl DeMaio

AN ORANGE COUNTY PRODUCT who came to San Diego via Washington, D.C., Carl DeMaio has won considerable attention in a surprisingly short period of time. A graduate of Georgetown Prep and Georgetown University, DeMaio established three companies while still in his 20s, including The Performance Institute, a private think tank that does $10 million annually, holding training sessions for government leaders and managers. He played a key role in the Citizens Budget Project to streamline state government following Governor Gray Davis’ recall. He has been an adviser to Governor Arnold Schwarzenegger, and he’s served on White House advisory panels. DeMaio arrived in San Diego five years ago——just before the city began to sink under the weight of a $2 billion pension deficit——and he quickly became an outspoken, and controversial, advocate for reform.

TOM BLAIR: Some résumé for a 32-year-old. Are you an overachiever?

CARL DEMAIO: I don’t think so. I think I do have a good team with me . . .

TB: You’re already sounding like a politician.

CD: No, I’m serious. I really am passionate about the work we’re doing.

TB: What makes you passionate?

CD: I think it’s a sense of outrage when government fails——because so many people rely on government to produce results, whether it’s residents wanting the streets patrolled, the trash picked up or the educational system teaching our kids. When it fails, I can also see where it’s succeeding, and I wonder why we can’t have success across the board.

TB: Have you always been a political junkie? When you were in eighth grade, did you subscribe to U.S. News & World Report?

CD: No. I guess I’ve just always had a sense of public service. As a child, I had the great fortune of going to a good set of schools. In Anaheim, at St. Catherine’s military school, those Dominican nuns will instill a sense of discipline in you. Also, I went to a Jesuit high school and college. The Jesuits really have a sense of giving back——and I identified with that.

TB: You came to San Diego five years ago. Why San Diego? Did you know it was going to be a great case study in mismanagement?

CD: Actually, no. Southern California is my home, and I feel like a fish out of water when I’m in Washington, D.C. Also, my companies do a lot of conferences and forums for corporate executives, and they don’t want to go to Washington. They like San Diego.

TB: So San Diego’s dysfunctional government was just a bonus.

CD: When we originally conceived of The Performance Institute, we had just completed a state of California project where we uncovered raids on special funds, massive hidden deficits, debt being passed on from year to year, broken programs, a culture of incompetence. So we said let’s focus on something positive next; let’s go to a well-managed city.

TB: Ah, yes. In 2002, you appeared at City Hall to give San Diego’s City Council an award for running the most-efficient city government in California. In hindsight, is that just a bit embarrassing?

CD: Oh, absolutely. When we gave that award, we’d asked the top 10 California cities for their financial data and performance standards. Of course, we didn’t think for a moment that maybe these folks would issue false and misleading financial statements. When I found out we had such problems in San Diego, one of the things that drove me was a sense of outrage at folks out-and-out lying to the public.

TB: Two years ago, you and others warned San Diego was on the brink of bankruptcy. We’ve made some political changes since then. Have we stepped back from the brink?

CD: No. The stakes are as high as ever. We have yet to make the hard decisions——the reductions in spending necessary to bring the budget into balance; a plan to reduce the pension debt by infusing new resources. Meanwhile, we see potholes; we see reductions in libraries and parks and swimming pools. We have a reform-minded mayor in Jerry Sanders. But you also need to have a reform-minded council.

TB: Sanders is the first “strong mayor” under our new form of city government. Did you support the move to a strong mayor?

CD: Yes. We were strongly in support of Proposition F, even though I was not too enamored of the downtown special interests that were pushing it. I supported it because I felt we needed to end the debate on who’s in charge.

TB: It hasn’t quite played out that way, has it?

CD: Well, I think it has. When there was bad news at City Hall, we had a city manager form of government; the council and mayor hid behind the city manager. Of course, when there was something good to report, we had a strong mayor and strong council, because they wanted credit. When things went wrong, it was the city manager’s fault. We had to end the finger-pointing by putting one person in charge.

TB: But with our so-called “strong mayor” government, the city council is already at odds with the mayor over budget cuts——a majority insisting they have the right to reinstate items. Isn’t that politics as usual at City Hall?

CD: No. It’s behavior as usual from these council people. They’ve spent our city to the brink of bankruptcy, and out-and-out lied to the public. But instead of being ashamed of what they’ve done——and making amends in their final two years in office——they continue to fight the solution.

TB: Will they doom the mayor’s efforts to restore fiscal discipline?

CD: They’ll cost our city much-needed time. We don’t have cash, and we’re running out of time. The people will be asked in the 2008 council elections whether they want a reform-minded council or the same special-interest–driven candidates that have been handpicked in the past.

TB: As long as our councilmembers are elected only within their districts, can we ever overcome the pork-barrel politics we’re seeing now?

CD: Certainly, district-only elections have magnified the influence of special interests. We’ve created fiefdoms with folks just interested in narrow parochial interests——and getting reelected. The power of special-interest money, when you’re just dealing with district elections, goes a long way toward influencing the outcome. So we get folks who curry favor with special interests for the money they can expend in their districts. Yes, they should be representing the diversity of their communities, but also always looking out for the broad public interest.

TB: That sounds like a return to our old system. Before district elections, councilmembers were nominated within their districts, but ran citywide in the general election.

CD: One thing we do want to keep is representation of the diverse elements of our city. But district-only primaries and citywide general elections can certainly accomplish that.

TB: We’ve talked about the mayor’s and council’s roles. But there’s a joker in the deck by the name of Mike Aguirre . . .

CD: I think “joker” is a polite term.

TB: Our city attorney and mayor did a cordial dance for a while, but things quickly turned sour. Do you think Mr. Aguirre is going to continue to be the pit bull of City Hall?

CD: Mike’s role, at one point, was very productive, because he was taking on former Mayor Dick Murphy and a recalcitrant council. He was dragging the truth out. But Mike needs to realize not everyone is responsible for the problems, that there are actually people out there trying to do good. He needs to represent our city with civility. I don’t think any of us would be proud of the behavior between our councilmembers and city attorney. They’re getting into food fights, not governing. I think Mike cares about San Diego. I just hope he has the personal-growth potential to get along with others. To focus his efforts on the issues that need the city attorney’s attention.

TB: Such as?

CD: Such as getting timely legal advice to the public and our city council before votes are held. In December, on the city’s housing plan, the city attorney arrived on the day of the council meeting with an opinion basically saying what the council was going to do was illegal. The state, of course, didn’t agree with him. But putting aside the legal arguments, the fact that he was shoddy and late with his work meant the public was shut out of the process. The public deserved an opportunity to look at his legal arguments and the state’s arguments, and to weigh in. So an embarrassing fight occurred where you had Councilman Jim Madaffer screaming at Aguirre, saying he was a disgrace. And Aguirre saying Madaffer was going to jail because he’d broken laws. After the screaming match, what was lost was the answer to whether the city was going to be adopting a housing element that caused a potential liability.

TB: Let’s turn to the so-called “Negligent Five,” the councilmembers whose votes led us to the current fiscal morass. What do you think the political future holds for them?

CD: I don’t think they have a political future whatsoever. And I don’t think they warrant a political future.

TB: Do they have a future in court?

CD: I’ll leave that to the U.S. attorney and the district attorney. But I think in the court of public opinion, they’ll be held accountable.

TB: When Mayor Murphy was forced out of office in 2005, your Performance Institute took center stage in pushing for reforms. You said if no credible reform candidate came forward, you might run for mayor. Local politicos have suspected you have your own political agenda. Are you running for something?

CD: Well, the 2008 city council elections will be key for San Diego. The Negligent Five are going to be offstage, and we’ll have an opportunity to elect a truly reform-minded city council. That council can work collaboratively with the mayor, make the hard decisions, be honest and restore integrity. If we don’t elect a reform-minded city council, I believe our city continues down the path of instability, financial mismanagement and overspending.

TB: So you’re saying . . .

CD: I’m very excited by the prospect of being part of that reform team——from District 5. But I’d look at three criteria. First, can I contribute to moving our city forward by being on the council? Second, I care a lot about the mission we’ve begun at The Performance Institute, and I want to make sure that continues. And third, as a private individual, can I live with the public scrutiny? Am I prepared to have the public shine a light on my personal life?

TB: Do you have some particular issue there?

CD: The fact that I’m gay, I suppose. But at the end of the day, I don’t think it’s very relevant when you consider all the things that are really important to voters. We have the city’s greatest financial crisis ever. We have city services being cut in our neighborhoods. Our leaders breaking the public trust by violating the law.

TB: You wouldn’t be our first gay councilmember.

CD: True. And even though it may be uncomfortable for me——coming out, being honest with the people——I think that’s what people want. It certainly hasn’t been relevant in the past five years, as we’ve sought to bring the city’s problems to public light, although some of the folks we were shining a light on did put pressure on us in regard to my personal life——in an effort to get us to back off. We didn’t.

TB: I guess it comes down to whether it’s better to be outside of office throwing stones, or inside, dodging them.

CD: I was at a reception recently, and an insider, who’ll remain nameless, said, “You know, Carl, there’s now a curse word going around City Hall, among the insiders and union folks, that’s worse than ‘Carl DeMaio.’ It’s ‘Councilmember Carl DeMaio.’ ”