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Former congressman featured in Brown ad calls Brown "a classic retread"

October 6, 2010 |  2:44 pm

Last week, Jerry Brown unveiled a new ad calling Meg Whitman's character into question, attacking her over old stock deals. In the ad Brown's campaign highlighted a process known as "spinning," in which Goldman Sachs and other investment banks offered shares of initial public offerings to preferred customers like Whitman. Whitman quickly sold those shares for profits, earning her millions.

Brown's ad cites a quote from then-Rep. Michael Oxley (R-Ohio), who called the practice of spinning "corrupt." "What kind of person would be involved in deals a fellow Republican congressman called corrupt?" the ad asks.

Now, Oxley said, Brown's campaign is taking those comments out of context.

"I never called anybody names," Oxley said in an interview Wednesday. "I have a great deal of respect for Meg. She was one of those CEOs that was hands-on, willing to come on the Hill and lobby for different positions for her company. That was kind of rare in Washington."

Oxley called Brown "just a classic retread. I can't imagine that California would reelect him, but who knows?"

Oxley railed against the practice of spinning as chairman of the House Financial Services Committee in 2002.

''I call on every Wall Street firm to show respect for America's individual investors by reforming these corrupt practices immediately," he said in 2002.

But Oxley said his criticism was directed at the investment banks like Goldman that offered the shares, not recipients of those shares like Whitman. Oxley said Brown's use of his 8-year-old comments is an example of a broken political system.

 "It stinks," he said. "Politics has really gotten to that point where a candidate can quote somebody they've never even met. It's kind of a pathetic example of politics at its worst."

Oxley said he doesn't blame Whitman for cashing in on those stock shares. "At the time, it was, from the perception of the recipient, kind of a standard practice. Those folks -- some I knew, some I didn't -- I don't think any of them would do something that was unlawful or unethical. It's kind of sad that the political process has just degenerated as badly as it has. No wonder the people are pissed off."

Brown spokesman Sterling Clifford jabbed back at Oxley. "You know what's an example of politics at his worst? A politician selling out his principles a decade later to help a fellow politician from their own party."

As for Whitman's assertion that spinning was standard practice during the dot-com boom, Clifford said: "We're electing a governor here. So, I guess the question is, do we want a governor who settles for standard practice at the time or someone who settles for what's right and what's wrong?"

-- Anthony York in Sacramento