Wealthy GOP Venture Capitalist Enters Illinois Governor's Race
Wealthy venture capitalist Bruce Rauner has formally entered the Republican governor's race, saying state government is broken and portraying himself as a down-to-earth businessman who can fix it.
By Monique Garcia and Bob Secter
Wealthy venture capitalist Bruce Rauner formally entered the Republican governor's race Wednesday, saying state government is broken and portraying himself as a down-to-earth businessman who can fix it.
Rauner made the announcement in a three-minute video posted on his campaign website, opting for short one-on-one interviews with reporters instead of the usual pomp and circumstance of a news conference. The move had been long expected after his monthslong "listening tour" across Illinois.
Rauner, 57, is a multimillionaire venture capitalist and private equity specialist who touts his business experience as what's needed to pull Illinois out of its budget crisis, which includes a public employee pension system nearing $100 billion in debt.
He didn't say how he would fix the pension problem during his introductory video, instead telling an up-by-the-bootstraps story in which he learned to ride a horse at age 6, milk a cow at 8 and fire a rifle at 10. The pitch seemed tailored for an audience beyond the Chicago area, ignoring the details that Rauner grew up in suburban Deerfield as the son of a Motorola executive and now has homes in affluent Winnetka and in a downtown high-rise.
In an interview with the Tribune, Rauner railed against a broken and corrupt state government he argued is run by union bosses instead of the elected officials voters send to Springfield. While he took direct aim at ruling Chicago Democrats -- including Gov. Pat Quinn, House Speaker Michael Madigan and Senate President John Cullerton -- he argued that many Republicans are also to blame.
"The government union bosses are the most powerful politicians in Springfield," Rauner said. "They own the Democratic Party. ... They are far and away the biggest funders of the Democratic Party, and also unfortunately for us, they have paid for a number of the Republicans in Springfield too."
The claim may serve as an effort to further distinguish himself from a potentially crowded Republican field. Illinois Treasurer Dan Rutherford launched his campaign Sunday. State Sen. Kirk Dillard of Hinsdale is expected to do so within weeks. And state Sen. Bill Brady of Bloomington, who narrowly lost the 2010 governor's race, is weighing a bid.
Unlike the other Republican candidates, Rauner has the wealth to largely self-fund a statewide race. He so far has reported putting about a quarter-million dollars into his campaign fund while raising more than $1.8 million before his official announcement. He would not say how much of his own money he is prepared to spend.
"We'll see, you know, whatever. We want to win," Rauner said. "To win, money matters. But that's not the real issue. The real issue is hard work and connecting with voters and getting out there."
Despite his sharp rhetoric on Illinois' problems, Rauner has so far been short on details when it comes to the state's political hot buttons.
He said the best way to solve the pension crisis is to do away with the current benefit system entirely. While current workers and retirees would keep their benefits, new workers would have to choose between plans that could include a defined contribution plan such as a 401(k), a restructured and less-generous defined benefit plan than is currently on the books or a mix of both. It's unclear how that would eliminate the pension debt.
"We need a dramatic restructuring of the pensions, and I don't think the bills that were discussed in Springfield went nearly far enough," Rauner said, referring to competing proposals for cutting pension benefits that failed in the spring session of the legislature. "Frankly, the historic system is absolutely unaffordable and incredibly generous, it's way beyond anything that the average voters and people of Illinois get in their private-sector jobs and it's not right that taxpayers should be funding a pension system that's so much more generous than they get in their own lives."
On social issues, Rauner said he believed voters should decide whether to legalize same-sex marriage via referendum, saying it's "the best way to handle a social acceptance issue like that." A bill to legalize gay marriage passed the Senate but wasn't called for a vote in the House last Friday before lawmakers left Springfield.
Rauner said he supports abortion rights early in pregnancy, but also backs restrictions for late-term abortions. He said he would also support parental notification for minors seeking to end a pregnancy.
Although Rauner is seeking to portray himself as an outsider, his personal and business interests have brought him in contact with the state's political power structure.
Government pension funds, including the financially beleaguered ones in Illinois, are a major source of capital for GTCR, a private equity firm co-founded by Rauner that declares on its website that it has invested $10 billion in more than 200 companies over more than three decades.
Among those investments was a high-profile deal for an alarm company brokered by then-investment banker Rahm Emanuel more than a decade before he became mayor. GTCR under Rauner bought SecurityLink for $479 million from SBC and flipped it to another buyer six months later for a price of $1 billion.
Rauner has since served as an unofficial adviser to the Democratic mayor and has said he regularly speaks with Emanuel. One key area of agreement is support for charter schools and criticism of the Chicago Teachers Union.
Rauner is a prominent financial supporter of the Noble Network of Charter Schools, which has named a school for him. Rauner's wife, Diana, runs the nonprofit Ounce of Prevention Fund that advocates for early education programs, and Emanuel named her to his education transition team.
Rauner was instrumental in bringing the education group Stand for Children to Illinois, where it has strongly backed Emanuel's education decisions. When the mayor raised $5 million in a private bonus fund for the "best-performing" local principals, Bruce and Diana Rauner contributed $2 million.
Though Winnetka is home to prestigious New Trier High School, Rauner got his daughter enrolled in Chicago's nationally ranked Walter Payton College Prep in 2008. A so-called clout list obtained by the Tribune indicated that Rauner contacted officials in the office of then-CPS CEO Arne Duncan, now the U.S. education secretary.
Asked whether Rauner lobbied top CPS officials for a favor, spokesman Mike Schrimpf said Rauner "is not going to make his children part of the political process" but added that "he is not going to apologize for standing up for his children because she was a highly qualified applicant under the discretionary principal's list."
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