High Speed De-Rail: Schwarzenegger Cronies Give Up $9 Million in Easy Money

Looking for proof that good old fashioned muckraking can alter the course of political decision-making?

Well, consider the latest twist in the controversy over Schwarzenegger cronies who had been handed a staggering $9 million for public relations efforts concerning California's high speed rail. Turns out Mercury Public Affairs, whose partners include an ex-Schwarzenegger campaign manager and the governor's former communications director, has dropped out of the game.

One article after another criticizing the firm's insider connections appears to have prompted Mercury to abandon ship. The California High Speed Rail Authority had decided to rebid the contract once word got out that the PR firm's partners were old buddies of the governor. Initially Mercury said it would re-apply for the job, but yesterday officials said they were too frustrated to continue.

A Mercury spokesperson told the L.A. Times that the firm did not want to invest its energy "into a process we no longer have confidence in, nor believe in."

That's funny, because we didn't think too highly of the process that gifted Mercury the contract to begin with.

Mercury, which was first awarded the PR contract in September by a three-member panel of rail authority staff members, is run by several of Schwarzenegger's friends.

Adam Mendelsohn is a former communications director for the governor; Steve Schmidt was Schwarzenegger's '06 re-election campaign manager; and Fabian Nunez is the former Assembly speaker.

New contenders for the $9 million, five-year PR gig have not been announced.


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