Arnold's Fundraising Flip Flop

Republican Arnold Schwarzenegger took his campaign to California's agricultural heartland Thursday for a rare personal appearance, trying to shake off bumps and bruises from the political potholes his campaign hit this week.

The biggest one is fundraising, something he implied from day one he wouldn't do, reports CBS News Correspondent Jerry Bowen.

"I don't need to take any money from anybody," he said on August 6, when he announced his candidacy. "I have plenty of money myself."

But the latest campaign finance reports show Schwarzenegger's the number one fundraiser in the large field of candidates seeking to replace Democratic Gov. Gray Davis. He's raised more than $3 million so far; $2 million of it from his own pocket, the rest from very wealthy contributors.

Schwarzenegger defended himself on the radio talk show circuit, where he's doing most of his campaigning by telephone.

"It is wrong to take money for instance from a union when you have to negotiate with that union," he said on the radio.

But his donors are some of California's biggest special interests: Irvine Company, a developer; Emulex, which lobbies on corporate tax regulations; and Castle and Cooke, which backs corporate tax reform:

"I don't promise anyone anything. There are no strings attached to anyone," Schwarzenegger said.

"It looks like he's defining special interests as anyone who supports one of his opponents," says Larry Noble of the Center for Responsive Politics, a nonpartisan Washington-based group that tracks campaign spending.

Schwarzenegger also came under fire Thursday from the nation's oldest Hispanic civil rights group, which called on him to step down from the advisory board of U.S. English, a group that seeks to make English the official language of the United States.

The League of United Latin American Citizens said the Austrian-born actor's position brings into question his commitment to Hispanics.

"It just seems like all the issues that we support he doesn't," Gabriela Lemus, the league's director of policy and legislation, said Thursday. The league said it is not taking a position on whether Gov. Gray Davis should be recalled and will not endorse a replacement candidate.

Schwarzenegger spokesman Sean Walsh said the actor agrees with U.S. English's attempts to make English the official language.

"Arnold Schwarzenegger came to this country with a few dollars in his pocket and not speaking the English language, and he realized the importance of learning to speak English as quickly as possible to achieve your American dreams," Walsh said.

Elsewhere on the campaign trail, Lt. Gov. Cruz Bustamante accused the big oil companies of ripping off Californians and vowed to bring them under state regulatory control.

"Californians are being gouged, and under current law we are powerless to do anything about it," he said in an appearance at a Sacramento gas station.

He reminded voters they will be paying the highest prices in the nation for gasoline this Labor Day weekend.

"The oil companies explain their behavior the same way Enron did," Bustamante said. "They say it was someone else's fault. ... But what they never say is that their profit margin in California is the highest in the nation."

Bustamante is the front-runner in the race to replace fellow Democrat Davis if he is recalled Oct. 7, according to a recent Los Angeles Times poll, while Schwarzenegger is second.

Other high-profile candidates were also busy around the state.

Former baseball commissioner Peter Ueberroth was in San Diego to hold the first of several town hall meetings with voters, as was Republican state Sen. Tom McClintock who was to speak on Roger Hedgecock's KOGO radio show.

Davis, Bustamante and McClintock also were meeting with the California Nations Indian Gaming Association, which represents 57 tribal governments. The group will not endorse a candidate, but its members have become an influential political force capable of boosting campaign coffers.

The demand that Schwarzenegger leave U.S. English came as the Republican was embarking on a campaign swing through California's Central Valley, including a stop in Fresno, former hometown of Democrat Bustamante.

The area also includes the nation's most productive farmland and is home to many ethnic groups and immigrants, including Hispanics.

Lemus said Schwarzenegger's membership on the board of U.S. English "does not bode well for Hispanics."

"So many of us support bilingualism and bilingual education and maintaining our culture and he's essentially saying it's not valid by being part of this board that has got this whole anti-immigrant, underlying racist mentality," Lemus said.

Schwarzenegger is just one of many prominent people on the group's advisory board, according to its Web site. Others includes golfer Arnold Palmer, television personality Alex Trebek and actor Charlton Heston.

Schwarzenegger is also dealing with the ghost of Arnold past. A 26-year-old interview in a men's magazine has resurfaced in which the then-bodybuilder talked about his drug use and sexual encounters – matters he later acknowledged in his own autobiography.

"I never lived my life to be a politician," he told a Sacramento radio station Wednesday night. "I never lived my life to be governor of California."