In the crowded primary for California controller, Yvonne Yiu is betting that spending millions of her own money is her ticket to the top two. But the track record of self-funding candidates in statewide races is mixed.
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In most California elections, the race for state controller doesn’t get much attention.
But this year, it’s one of the hottest races. And the political dynamics make it unpredictable, potentially opening a path for a candidate who isn’t campaigning very much — but is spending millions of her own money.
Some strategists believe that Lanhee Chen, the sole Republican in the June 7 primary, is likely to nab one of the two spots on the November ballot. That would force four Democrats to battle for the second slot.
There’s Malia Cohen, chairperson of the state Board of Equalization, who has the California Democratic Party’s endorsement. There’s also Steve Glazer, a state senator from the Bay Area who’s pitching himself as an independent watchdog who will stand up to party leaders.
There’s Ron Galperin, who serves as controller of the city of Los Angeles — the “golden ballot designation,” he says, because he’s the only candidate with “controller” next to his name. He also says he’s well-known in Los Angeles, and hopes to capitalize on high voter turnout for the high-profile mayoral race.
And then there’s Yvonne Yiu, a current city council member and former mayor of Monterey Park (population 60,000) in the San Gabriel Valley. A longtime financial advisor, she has already funneled about $5.7 million of her own money into her campaign, including a $1.2 million donation last Thursday.
That’s 95% of her total fundraising of $6 million so far. The other four major contenders have raised about $7 million — combined. As of May 27, more money has been contributed directly to campaigns in the controller’s race ($14.3 million) than in any statewide contest, including governor ($13.5 million) and attorney general ($12.6 million) — and it’s basically because of Yiu.
The amount of cash she’s willing to spend on a down-ballot race has raised eyebrows — and makes her an outlier among all candidates running for state office in the primary.
The other candidates for controller and their supporters aren't standing pat. Glazer is getting help from an independent expenditure committee funded by the California Chamber of Commerce, which has spent $650,000 on his behalf. And another IE group, sponsored by labor, nurses and educators, is backing Cohen. It reported spending more than $450,000 between May 23 and May 27 to support Cohen — and the same amount to oppose Chen.
A stealth candidate?
On May 5, three days after Politico’s scoop of a draft U.S. Supreme Court ruling to strike down the landmark Roe v. Wade decision, Cohen called on Chen to declare his stance on abortion rights once and for all. Galperin and Glazer soon followed.
The controller does not make state policy, but as California prepares to become a sanctuary for those seeking abortions, it’s possible that state spending could fall under some limited purview of the controller. Still, campaigning on abortion rights could boost a candidate’s name recognition. Democrats hope it helps them at the polls, trumping voter concerns such as crime, homelessness and inflation.
But while the other candidates sought out attention, Yiu stayed out.
It’s fitting with the stealthier approach she’s taken so far. In her own words, she’s the most unknown candidate — and unlike the other candidates, she’s not interested in using the controller’s office as a steppingstone.
“I want to do what I’m good at, which is finance,” she said in an endorsement interview with the Sacramento Bee.
It’s not that she’s not campaigning at all. For her 50th birthday last October, Yiu threw a campaign fundraiser. She also attended the state Democratic Party convention in March and made her pitch for the party’s endorsement. She has been posting financial literacy tips on her Instagram page, touting her endorsements on her Facebook page and courting Asian-American voters through events, groups and targeted media.
She declined to be interviewed for this story. Asked why she’s willing to spend so much of her own money to become controller, she responded by email that as an immigrant and woman, she has been underestimated her whole career and has always relied on herself.
“When I announced my campaign for State Controller, I was discounted again – by political insiders, party elites and special interest groups. I decided to do what I’ve always done when I wanted something. I counted on myself to get the job done,” she told CalMatters.
“The fact that I’ve put my own money into this race makes me independent, and the voters will never have to question whether I have their best interests at heart.”
Unlike the other major controller candidates, she also declined in-person, video interviews with CalMatters for its Voter Guide, submitting written answers instead.
She also doesn’t speak in her campaign ads — instead letting a narrator introduce her to seemingly random voters and promote her campaign slogan: “Yiu is for You.”
But Yiu says she doesn’t believe lack of name recognition statewide is a problem, saying that voters aren’t that familiar with any of the candidates in the race. If media endorsements are any indication, the three-way split among the top candidates shows it’s anyone’s game.
“I am not a traditional candidate who has spent their career in politics. The fact is I am not known by the political insiders,” Yiu said in the email. “My strength, however, is my background, experience, and skills which I believe is what voters are looking for in a state controller — someone who understands finance, knows how to manage investments and can save taxpayers money.”
She’s not the first statewide candidate to take a somewhat “stealth” approach to campaigning, relying mostly on TV ads and mailers to win over voters. But that strategy has its limits.
Matt Shupe, a political strategist for several Republican candidates and campaigns, said the power of TV ads only goes so far.
“Campaigns will always be limited by a finite amount of funds, and how those resources are marshaled are some of the most important decisions a campaign makes. If you’re buying all your ads on TV, you are missing out on people that cut the cord and are on Hulu and Netflix," Shupe said.
"Similarly, if you're only buying direct mail, you may miss voters on social media. Having the broadest spectrum of communications is vital and that is where the power of earned media is."
Political strategist Kevin Spillane said that while spending $4 million on TV ads will make an impact, there’s no guarantee that it will be enough.
In a down ballot race such as controller, ballot designation and partisanship play key roles.
“Her opponents each have individual spaces and name identification,” Spillane said, citing Galperin’s “controller” title and the reputations that Glazer and Cohen have built in the Bay Area. “That’s worth more than a new face coming in and trying to buy an office in those regions.”
Your guide to the 2022 general election in California
Lessons in self-funding
Yiu came to the U.S. from Hong Kong at the age of 16 following the death of her father. She earned her undergraduate degree in economics from UCLA, and her master’s degree in finance from Loyola Marymount University.
She says she never forgot the difficulties her mother faced raising three daughters on her own. It’s something she’s campaigning on — promoting financial literacy for women and people of color.
Yiu worked as a financial advisor and asset manager for firms including Merill Lynch, E*Trade Financial, Citicorp Investment Services and Charles Schwab. She also founded her own investment and brokerage firm that she reports managed $500 million in assets.
While now retired from finance, she has worked part-time as an arbitrator and expert witness for the Financial Industry Regulatory Authority, a private corporation that aims to self-regulate the finance industry. (That authority once censured and fined Yiu’s own firm for improperly depositing investor funds in a real estate trust account owned by one of the fund’s managing members.)
Now, she’s using some of that wealth to boost her campaign.
So what’s the power of self-funding?
In 2018, it boosted Republican John Cox into the top two for governor, though he eventually lost handily to Democrat Gavin Newsom.
Tim Rosales, who was Cox’s campaign manager, said a candidate’s own money provides the “luxury” of being able to bypass the press and pay for direct communication to voters.
“It can be a significant difference maker, especially when you’ve got a crowded field and candidates who are unknown and donors who are split,” he said. “Being able to invest in your own campaign to a great degree, it gives you lift.”
“People need to know that you’ve got skin in the game” if you don’t have a track record in politics, Rosales added. “It shows confidence, and it shows that you really believe you can do this.”
Also in 2018, Eleni Kounalakis, a political unknown and executive of one of the biggest land development companies in California, won the election for lieutenant governor after spending $7.7 million of her own money, and getting help from a $5 million independent expenditure effort funded by her father. This year, Kounalakis is facing only token opposition for reelection.
Money isn’t the whole picture, though. In California, it would take much more money than what Yiu has invested for a statewide media campaign, said Galperin, one of her Democratic competitors.
And, he told CalMatters, “Californians usually, not always, don’t like people just buying an election.”
Later Monday, in a fundraising email, Cohen called out Yiu’s spending and called on her supporters to “let Californians know that the Controller's office isn't for sale.”
There’s also a long history of self-funded candidates not winning: Republican Bill Simon, who unsuccessfully ran for governor in 2002; Democrat Steve Westly, who lost in the gubernatorial primary in 2006; and Republican Meg Whitman, who spent a record $140 million on her campaign, securing the nomination, but losing to Democratic Gov. Jerry Brown in 2010.
Rosales, the consultant, also pointed to the example of Al Checchi, who spent $40 million of his own money in the Democratic primary for governor in 1998 and ended up losing to Gray Davis, who had a strong foundation of support among the party from his long career.
“Money puts you in the conversation," Rosales said, "but it doesn’t necessarily win elections.”
CalMatters reporter Alexei Koseff contributed to this story.
more on controller candidates
In a 75-minute interview with CalMatters, Ron Galperin, a Democrat running for California controller, touts his experience as city controller in Los Angeles. He pledges to bring some of his innovations statewide and calls homelessness an existential crisis.
In a 70-minute interview with CalMatters, state Sen. Steve Glazer, a Democrat running for California controller, says he knows “where the bodies are buried” from his legislative experience. And he vows to stand up to fellow Democrats in power so he can be an independent watchdog.
Democrat Malia Cohen wants to expand the role of state controller and advance equity and diversity in the job. In an 80-minute interview with CalMatters, she says the state’s COVID response proves the need to do better on both those goals.
In a 70-minute interview with CalMatters reporters, Lanhee Chen, the only Republican running for state controller, talks about his priorities and how he would work with Democrats in power.