Schwarzenegger waves mandate at lawmakers

Calif. governor-elect says he'll go to the people if his proposals are blocked


SACRAMENTO, Calif. - Gov.-elect Arnold Schwarzenegger flexed his political muscle as he unveiled his transition team yesterday, warning Democrats he won't hesitate to go directly to the voters if opponents don't go along with his proposals.

"I'm absolutely convinced I'll be working very well with the legislature, Democrats and Republicans alike," Schwarzenegger said at a Los Angeles news conference, his second since his stunning victory Tuesday.

"If there is a problem, I will go directly to the people of California. They made it very clear they want change, and those guys up there in the legislature know that."

The warning was the first sign that sober realities might be settling in on what has been Schwarzenegger's storybook debut as a heavyweight player on the nation's political stage.

Schwarzenegger also called on Gov. Gray Davis to stop making appointments and signing bills, something that Davis's staff insisted the sitting governor would continue to do until he leaves office next month.

"The Republicans want the state to stop, but that can't happen," said Davis spokesman Russ Lopez. "The governor still must sign laws. These appointments have been in the process for months and months. Governor Davis thinks these are qualified people who will serve California well."

As in his first news conference Wednesday, Schwarzenegger gave few specifics yesterday about how he will deal with California's budget crisis. The state's deficit is often said to be $8 billion, but Schwarzenegger admitted the number could be higher and said that was why his first step would be to call for an outside audit of state books.

To that end, he announced that Donna Arduin, head of the Office of Policy and Budget for Florida Gov. Jeb Bush, has been brought on board. Arduin worked previously in New York and Michigan; she moved to Florida in 1998 when just-elected Bush was facing a serious budget crisis, although not on a scale with California's current problems.

A fiscal conservative, she helped Bush implement painful spending cuts and layoffs of state workers as the state grappled with revenue shortfalls.

Arduin said she would begin work immediately and "absolutely" would complete her work in time for Schwarzenegger's team to put together the budget proposal due Jan. 10.

Reporters asked Schwarzenegger why such an audit was necessary, pointing out that California's budget is a public record already open to anybody.

"The people of California have heard the deficit is $8 billion or could be $10 billion or even $20 billion," Schwarzenegger responded. "We don't know. We'll know soon. The only way you make good decisions is if you have all the information."

The budget crisis is clearly Schwarzenegger's most daunting challenge and - along with a stagnant economy that has seen the state lose thousands of jobs - has emerged in exit polls as a key reason that voters decided to oust Davis.

After a boom spurred by the Silicon Valley-based dot-com frenzy in the late 1990s, the state staggered through an energy crisis followed by an economic slowdown that saw the deficit balloon to as much as $38 billion in the past few years.

Davis stitched together a series of measures to reduce the figure to $8 billion, but one key remedy was to triple the vehicle licensing tax, a widely unpopular measure. Schwarzenegger has vowed to repeal it, but he has already begun squabbling with legislators over whether he has the authority to do so unilaterally or must get their approval.

Many analysts question how he'll close the deficit without the tax, which is supposed to bring in about $4 billion, especially since Schwarzenegger has vowed that he will not raise taxes.

The governor-elect deflected several questions from the press on the matter, saying he wanted to get the audit results first and would then share his plans with the public.

Schwarzenegger will take office sometime in mid-November, after state officials certify the election results, a process that could take more than a month.

Unofficial returns showed 55 percent of voters supported Davis's recall, while about 47 percent picked Schwarzenegger to replace him. Democratic Lt. Gov. Cruz Bustamante was a distant second with 32 percent.

Davis has not made any statements since his concession speech early Wednesday, when he pledged to work closely with Schwarzenegger on the transition.

Davis was a career politician who served in the State Assembly and as lieutenant governor before being elected governor in 1998 and re-elected just last year. His recall has been blamed by analysts on his colorless personality, a tendency to isolate himself even from his political allies and California's unprecedented budget woes.

As if to add insult to injury, an impromptu "thank you" rally for Davis on the Capitol's front steps yesterday drew barely a dozen people.

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