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Arnold: Feds 'Shouldn't Give Us a Penny'

December 1, 2008 - 12:59pm

At a press conference now concluding in downtown LA, Gov. Schwarzenegger said the federal government should not bail out his state -- at least until the state itself adopts a more fiscally responsible budget. In doing so, he appears to have boxed himself in. With Democrats in the legislature resisting deeper spending cuts and Republicans refusing to raise taxes, a federal bailout was seen as a way to address, at least in the short term, the state's persistent and growing budget shortfall.

Schwarzenegger called the press conference to announce his declaration of a state fiscal emergency. This provision of the constitution, enacted by voters as part of Prop 58 in 2004, gives the legislature 45 days to act to bring the budget back into balance. The provision is not seen as having the teeth necessary to force the legislature to fill the budget shortfall.

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