California is issuing IOUs and still doesn't have a balanced budget, but Gov. Arnold Schwarzenegger said Friday that it's far from the worst state in the nation for business.

Remember the Arnold Schwarzenegger who, exactly five years ago, denounced state legislators as "girlie men" beholden to unions because they failed to pass a state budget? He's back, sensing that time is running out on his 2003 campaign promise to stop "crazy deficit spending."
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California public employee unions already reeling from pay cuts have been dealt a new blow by Gov. Arnold Schwarzenegger – a push to lower pension and retiree health care benefits for state workers hired after today.
California Budget
Democratic legislators trotted out a stick-and-carrot approach to closing the state's budget gap Sunday night, negotiating with the governor on one floor of the Capitol while voting for a package of cuts and taxes on another.
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Gov. Arnold Schwarzenegger plans to furlough state workers an additional day each month starting in July if lawmakers do not send him an immediate solution for the entire $24 billion budget deficit, he said Friday.

  • Brian Baer / bbaer@sacbee.com

    Gov. Schwarzenegger joins Michaela Tritch, 8, of Los Angeles on stage as she places the last ornament on the tree and then lights it at the 77th Annual State Capitol Christmas Tree Lighting Ceremony at the Capitol on Tuesday, Dec. 9.

  • Brian Baer / bbaer@sacbee.com

    Senate Pro Tem Don Perata says goodbye to Gov. Arnold Schwarzenegger following remarks after their meeting on the budget crisis on Oct. 27, 2008.

  • Brian Baer / bbaer@sacbee.com

    Gov. Arnold Schwarzenegger joins the legislative leaders to talk about their meeting to discuss the budget crisis at the State Capitol in Sacramento on Oct. 8, 2008.

"I tell you, it is the greatest package; I am so happy that we are getting those kinds of benefits from the federal government and from President Obama."
- Gov. Arnold Schwarzenegger, introducing President Barack Obama on the president's first trip to California since the election..



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