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Davis On Shaky Ground In California?

California Governor Gray Davis
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Hotline Executive Editor and CBS Early Show contributor Craig Crawford reports that despite a big lead, California's governor could be in for a tough reelection battle..

Gray Davis could lose.

How could the Democratic governor of California blow a 14-point lead for his reelection bid in November? Because Bill Simon is running against him.

That's right, the same Republican even the White House dissed as too right-wing turns out to be a more promising candidate than his reputation in Washington suggests.

For starters, Simon is a warrior who already overcame a 30-point deficit to defeat President Bush's pick, Richard Riordan, for the Republican nomination. And this week he rolled out two middle-of-the-road heavy hitters as advisers to blunt his image of extremism: former New York Mayor Rudy Giuliani and former Secretary of State George Schultz.

Davis is doing all he can to give Simon a chance. Revelations about cozy no-bid state contracts with corporate contributors were followed this week by claims from teacher's union leaders he tried to shake them down for $1 million in a meeting about their policy requests. All that capped by his announcement of a plan for tax increases and budget cuts to deal with California's record-breaking $24 billion deficit.

Before this bad news hit the papers, Davis was already sitting on a 49 percent disapproval rating with voters.

California's budget crisis is a gift to Simon, the son of a fiscal policy giant who served as President Nixon’s treasury secretary and for decades was a leader among GOP economic conservatives.

Riding around Los Angeles in his black SUV with Giuliani this week, Simon grabs a cell phone for a live radio interview and, as always, stays precisely on message with a tightly worded indictment smoothly linking the budget deficit to Davis' fund-raising scandals.

"He's been raising cash at the rate of a million dollars per month. At the same time that the state has suffered he's raised $30 million for himself," Simon says. "What we need is old-style leadership. We need to renew the California Dream."

For a response to Simon's attacks, Davis yields to his tough-guy strategist Garry South, who tells reporters: "It's easy for a rich kid who inherited millions of dollars from his old man to criticize someone who works for a paycheck and has to raise money to run for office."

Unfazed by South's personal assaults, Simon keeps up the pressure in a Los Angeles press conference where he gives legs to an emerging story about another Davis fund-raising ploy: sending invitations to Berkeley college students offering face-time with the governor in exchange for a $100 campaign contribution. Simon quoted a student leader who told the San Francisco Chronicle, "Davis doesn't realize that he is basically shaking down students for their lunch money."

Going into this race, Davis had a potentially decisive advantage over Simon on social issues. Simon opposes abortion rights and gun control, putting him out of sync with most California voters.

But in recent weeks Davis stunned political pros, lurching to the left instead of hewing to the ideological center where he cautiously built his career. He told a gay newspaper he would appoint a task force to study Vermont-style civil unions, and in an appearance with the Rev. Jesse Jackson he discussed reparations for slavery.

Those moves point to worries about the Democratic base. When politicians must pander to their base in a general election campaign, you know they are in trouble.

Neither candidate in this race seems likely to ignite voters. Simon is hardly the charismatic figure Ronald Reagan presented when he stormed California to become its famously conservative governor.

Look for voters to face a close contest between lesser evils in November, what the sassy San Francisco Weekly labeled "Whore vs. Bore: A governor's race between a fund-raising slut and a clueless rich guy."

Susan Semeleer of the CBS News Political Unit contributed to this report.