California Insider

Senate leader John Burton, in a memo to members, has put them on notice to be ready to meet in special session on the afternoon of Nov. 18, the day after Arnold Schwarzenegger is scheduled to be sworn in as governor.

--Gov. Gray Davis and federal lawmakers from California asked for federal financial help in thinning dead trees in April, citing the danger of catastrophic fire. The feds failed to respond to the plea until last Friday, then denied the request. In the Chronicle.

--In the same story, it’s noted that forest scientists warned that more thinning was needed years ago, but were stymied by environmentalists opposed to legislation that would have allowed it. They opposed the proposals because the bills would have also allowed timber companies to cut more healthy trees.

--The San Diego County sheriff’s pilots who rescued the hunter believed to have started the Cedar fire alerted the US Forest Service, asked them to help fight the fire and asked for permission to collect water from hanging buckets to try to douse it. The Forest Service told them to stand down because night was falling and choppers don’t fight fire at night. Story in the LA Times.

--And here is the SD Union story from Thursday about teh state's refusal to use federal helicopters from North Island.

The debate over thinning and who did what, when, is going to rage for months, if not years. But it should be noted that most of the damage so far has occurred far from the forests that are at issue. The chaparral that burned in Ramona, Alpine, Crest, the city of San Diego and the Simi Valley has never been a serious candidate for the kind of thinning contemplated in the Healthy Forest bill, nor would it be practical to include it.

Then there is the story of John Lucas, the former firefighter who fought alone to save his own house near Lake Arrowhead. What Lucas did when the fire arrived couldn't be matched by most people. But it's interesting to note what he did in advance: planted a mini-greenbelt, thinned the forest, built a water tower. He knew the fire was coming and prepared for it, and his home survived. An example for other individuals in fire-prone areas, as well as for the government. In the Bee.

Ted Costa and Peoples Advocate, sponsors of the Davis Recall, today unveiled a proposed ballot measure to change the way political district lines are drawn. Costa's plan would allow legislative leaders to appoint 20 Californians to a pool from which the Judicial Council would select three special masters to make the decision. The masters would choose a plan from among those submitted by lawmakers and citizens groups. The choice would then go back to the Legislature for ratification and, finally, to a vote of the people. Costa hopes to qualify the measure for the November, 2004 ballot. If approved by the voters, the plan would take effect immediately, meaning that new districts would go into effect for the 2006 elections, even as voters had before them the question of whether they approve of those districts.

David Drucker at the Daily Bulletin in this story spots a point I overlooked in Legislative Analyst Liz Hill's budget analysis: she restates and clarifies her longheld position that Davis overstated the size of the shortfall. It was never $38 billion, Hill says, but more like $30 billion. The difference was in spending, not required by law, that Davis would have wanted to do but couldn't because of tough times. The guv listed those priorities, said we couldn't do them and then counted them as budget cuts, inflating both the size of the problem and the portion of his solution that came from spending reductions rather than tax increases. Hill does agree with the Davis folks that the current operating shortfall remains in the $10 billion range.

Rob Reiner and the California Teachers Association are preparing to file a ballot measure for November, 2004 that would increase commercial property taxes by 55 percent and dedicate the money -- $4.5 billion annually -- to expanded pre-school and K-12 education. The money for K-12 would have to supplement, not supplant, current funding and could be used only for reducing class size, purchasing textbooks, instructional materials, supplies and equipment, training teachers or raising teacher salaries. The pre-school money would be dedicated to universal access for all children in the year before kindergarten. That money could go for public preschool only. The measure would raise the property tax rate from 1 percent to 1.55 percent on commercial property, with agricultural, timber, open space and government property exempted. Rental property assessed at less than $700,000 would be exempt, and the rate on property assessed at above that amount would rise to the new limit on a sliding scale.

More, this one from the LA Times, on the dispute over how quickly state and federal agencies moved to combat the San Diego fire.

Former congressman and California Atty. Gen. Dan Lungren has formally opened his campaign for the 3rd District congressional seat now held by Doug Ose, who is retiring. Lungren will face off against state Sen. Rico Oller in the Republican primary in March. Lungren is backed by, among others, Ted Costa, the official sponsor of the California recall.

Dick Riordan is rumored to be a possible choice as education secretary for Schwarzenegger. It could be a brilliant move, placing LA’s former reform-minded mayor, who did battle with the teachers unions to try to turn the city’s schools around, as the new governor’s point man on public education. But here’s an even smarter idea: kill the job. In California, the education secretary is a glorified adviser to the governor with few real duties and only a handful of education programs to administer. We already have an entire department full of bureaucrats run by an elected superintendent (Jack O’Connell). And we have a policy-setting state board of education whose members are appointed by the governor. The job of education secretary was created by Pete Wilson in 1991 to prove that he was a pro-schools Republican and to give him more bodies in the battle against the bureaucracy. The office has grown steadily since then, even as its authority remains fairly limited. Ideally, I’d like to junk the superintendent and the state board and vest administrative powers in the governor, just as we do for health care, welfare, environmental regulation and other big issues. Then, maybe, we would need an education secretary instead of the superintendent. But that isn’t going to happen any time soon. In the meantime, Schwarzenegger could demonstrate his commitment to smaller government by naming Riordan or someone else as his education adviser, housed in the governor’s office, and eliminating the rest of the office of the education secretary. The move would save only about $1 million and would be criticized by status-quoists who equate government departments with concern about an issue. But it would be a gutsy step showing that the new gov is not wedded to the old way of doing things.

Mickey Kaus makes the case against editing blogs.

Josh Marshall at Talking Points Memo asked for contributions from readers to send him to New Hampshire to cover the final ten days of the presidential primary campaign. In 24 hours, he raised more than enough to cover the trip, and now he is offering refunds to donors. Love it.

From the Chronicle: "Gov. Gray Davis has warned Gov.-elect Arnold Schwarzenegger that California's unemployment insurance system will go bankrupt only weeks after he takes office, forcing the state to seek its first-ever bailout loan from the federal government that could top $1.17 billion."

Read the whole thing here.

In March, 2002, I wrote a column that warned of the coming bankruptcy in the fund. You can download it here.

Republicans on Monday accused Gov. Gray Davis of dragging his feet before requesting military help to fight the fires in San Diego County. Davis denies it. The San Diego Union provides this detailed story explaining how federal law and bureaucracy make quick decisions difficult in situations like this. Among other things, a 1930s-era law designed to protect civilian jobs prohibits the U.S. Forest Service from requesting military planes until all of its own resources are exhausted. The story does suggest that Davis, a former Army captain, might have been guilty of sticking to the established chain of command. Rep. Duncan Hunter, chairman of the House Armed Services Committee, said he gave state officials the home number of the chairman of the Joint Chiefs of Staff, who was standing by to order two planes into action, but nobody ever called him for help. Hunter's Alpine home was believed to be among those destroyed in the fire.

Public relations exec Donna Lucas has joined the Schwarzenegger transition staff as an aide to Maria Shriver. Lucas, a partner in the Porter Novelli International PR firm, is taking a three-week leave from the company to work as a volunteer on the transition staff, where she will help Shriver set up her own staff and establish the priorities on which she will concentrate as First Lady. Lucas was a press aide to former Gov. George Deukmejian and press secretary for George Bush's 1988 presidential campaign in California (the last Republican to win the state) before building a successful Sacramento public relations firm that eventually was bought by Porter Novelli. She is married to San Francisco Chronicle reporter Greg Lucas.

Democrat state Sen. Dean Florez, who as chairman of the Joint Legislative Audit Committee helped disclose the details behind the Oracle computer software foul-up, is working with Gov.-elect Arnold Schwarzenegger to find more waste and abuse in the state budget. Florez, never shy about publicity, tells me Schwarzenegger called him at home last week, and they spoke about the Oracle deal and the possibility of finding more problems deep within the state bureaucracy. Florez followed up with a short conversation with Schwarzenegger’s auditor, Donna Arduin, and the two plan to meet on Tuesday. Florez also has sent Schwarzenegger a six-page letter urging him to look at state overtime abuses, procurement practices, technology purchases, surplus property, and the Departments of Veterans Affairs and Corrections. The senator, who fell out of favor with Gray Davis after harshly criticizing his fellow Democrat over the Oracle debacle, told the new governor he could probably save at least $1 billion by following the Florez roadmap.

While the governor-elect is waiting for Florida budget chief Donna Arduin to complete her audit of California's books, he might want to review Legislative Analyst Elizabeth Hill's latest 77-page take on the budget, the shortfall, how we got here and what the outlook is for 04-05. You can find it here.

The Fresno Bee, the Chronicle and the Times take looks at Schwarzenegger's planned trip to Washington this week, and almost nobody in any of the three pieces believes the new governor can extract significant fiscal help from the federal government.

The Oakland Tribune takes a long, nuanced look at the controversy over UC Berkeley's admission of students with low SAT scores. The story adds new data about the race and ethnicity of the special admissions.

Here is the Bee's story on the appointments flap. It looks as if about 20 of the Davis appointees might survive. I think the untold angle in this whole afffair was that Senate Leader John Burton really did not want to bring his members back to do Davis' bidding, not just because it would look bad politically but because Burton never liked Davis. He's also not all that fond of some of the appointees. But he did want to protect Democratic interests on some of the board and commissions, especially the Agricultural Labor Relations Board, so the deal makes sense for both sides.

Senate Leader John Burton has notified members not to expect to reconvene in session before Gov. Gray Davis leaves office. That means last-minute Davis appointees who require confirmation will have their fates in the hands of Gov.-elect Schwarzenegger, who could rescind any of the appointments before they are confirmed.

This doesn't necessarily mean there is not a deal between the camps. We won't know that until we see how the new guv handles the old guv's moves. It is possible that Schwarzenegger has agreed to leave certain of Davis' appointments in place in exchange for an agreement that the Senate will not confirm the others.

Here is the text of Burton's notice to members:

"To quell any speculation regarding our reconvening in the near future: the Senate will not meet next week, nor at this time do I anticipate any extraordinary meeting.

"Legislative matters, including confirmation, will be handled in the normal course of business when we meet as regularly scheduled."

A coalition of business groups will seek to qualify a referendum to block the enactment of SB 2, the measure passed at the end of the legislative session to require businesses with more than 50 employees to provide health insurance for their workers. Calling themselves "Californians Against Government Run Healthcare," the California Chamber of Commerce, California Restaurant Association, California Taxpayers Association, California Retailers Association and the California Business Properties Association will try to round up 373,816 signatures of registered voters to put the bill on the March, 2004 ballot. The group claims the bill will cost business and consumers $7 billion a year and do for health care what the 1996 electricity industry restructuring bill did for California's energy industry.

This is at least the fourth move afoot to block actions taken by Gov. Gray Davis in the months before the recall. Sen. Tom McClintock is leading an effort to repeal the car tax, which Davis tripled by administrative order. Another group is trying to referenda SB 60, the measure that would allow illegal immigrants to obtain California drivers licenses. And religious conservatives are suing to block AB 205, which gave same-sex domestic partners many of the same rights and responsiblities now enjoyed by married couples.

State Sen. John Vasconcellos, who called Schwarzenegger a "boob" shortly after the election and said he was thinking of quitting the Legislature after 37 years rather than serve under him as governor, issued a long, rambling statement today retracting the words if not the sentiment. Vasco, in the 2,000-word piece, said he might have been wiser to use the word "amatuer" or "impersonator" or the "Grand Illusionist" rather than "boob," and he said he fully intended to serve the remainder of his term in the Legislature.

Said Vasco: "I have devoted 38 years of my life (more than 1/2 my life, 3/4s of my adult life) to serving the People and State of California, and to developing the masteries of subject and process that have enabled me to become a good effective trusted respected public servant; If I had announced last week that I fully intend to take over management of the New York Yankees for their coming World Series face-off, I'd expect most folks would have laughed out loud, and I
wouldn't have been surprised nor taken offense if any of them characterized me as in that outburst I did our Governor-elect."

Everybody made nice today when the governor and the governor-elect got together for their first meeting ever, to discuss the transition. But behind the scenes, the Davis and Schwarzenegger camps and the offices of Senate Leader John Burton are waging a three-way stare-down over potential last-minute Davis appointments that would need confirmation from the Senate if they are to stand. Schwarzenegger has said that he recognizes Davis's right to make appointments up until he leaves office. Davis has said he intends to exercise that right, and insiders believe the beneficiaries would include several of his top aides, including Chief of Staff Lynn Schenk and Cabinet Secretary Daniel Zingale. But some of the appointments the best and highest paying among them require Senate confirmation, and Burton is trying to decide whether to bring the body in for an unusual October session to do the deed. Democrats who favor doing so are relying on the legalistic view they have the right but perhaps ignoring the political realities. If Schwarzenegger objects, he can wage a public protest, and the reaction to the Senate's action would likely be highly negative. Most voters, even some of those who opposed the recall, would probably reject the idea of the ousted governor giving big jobs to his friends and aides on the way out the door, and to the Senate making a special effort to come in to help him cement those appointments in place. But Schwarzenegger also has something to gain from negotiating with Davis and Burton because Davis, if everybody agrees, could hold back on some appointments he is entitled to make and leave those slots for Schwarzenegger to fill when he takes office. That sort of deal would be typical. Davis and his predecessor, Pete Wilson, struck a pact along those lines in 1998. It would be, to use one of Schwarzenegger's favorite phrases, politics as usual.

For more on this topic, here is a Chronicle story on the subject.

"Where government moves in, community retreats, civil society disintegrates, and our ability to control our destiny atrophies. The result is: families under siege, war in the streets, unapologetic expropriation of property, the precipitous decline of the rule of law, the rapid rise of corruption, the loss of civility and the triumph of deceit," -- California Supreme Court Justice Janice Rogers Brown in a speech to the Federalist Society at the University of Chicago Law School three years ago.

Brown explained her views Wednesday at her comfirmation hearing for a seat on the Washington D.C. Circuit of the U.S. Court of Appeals. Here is the story in the Bee.

Gov.-elect Schwarzenegger says he will call the Legislature immediately into special session upon his swearing in, and will ask lawmakers to fix workers compensation, repeal SB 60, the illegal immigrant driver’s license bill, and begin work on closing the budget gap. Asked by reporters if maybe he was moving a little bit too quickly, Schwarzenegger replied:

"Action, action, action, action. That's what people have voted me into this office for. They wanted to have a governor that is filled with action, that performs and that represents the people, and that's what I'm here to do."

Here is the full story In the Bee.

While Gov.-elect Arnold Schwarzenegger was drawing the media throngs in the Capitol today, his transition director, Rep. David Dreier, slipped away for a private meeting with Sen. Tom McClintock. The session, which lasted about 30 minutes in McClintock's third-floor Capitol office, was the first serious outreach from the Schwarzenegger operation to the man many Republican insiders at one time thought might cost Arnold the election. I asked Dreier if the Schwarzenegger team planned to work with McClintock, and he suggested that his presence at the senator's office was an indication that they would. McClintock told me afterword that the meeting was "cordial" and said he stands ready to help Schwarzenegger on the goal they share: reining in state spending and cutting taxes. Typical in a situation like this would be for Schwarzenegger to freeze McClintock out, to marginalize him and try to make an example of a guy who was not a "team player." While I doubt the relations between the two will ever be warm, perhaps today's meeting was a sign that Schwarzenegger understands that one of the best ways to neutralize your enemies is to bring them into your fold.

The choice of Patricia Clarey as chief of staff leaves Arnold Schwarzenegger open to two quick criticisms: he is hiring, effectively, an HMO lobbyist as his top aide and also choosing a loyalist to former Gov. Pete Wilson. The lobbyist tag is obvious. Seems like a strange move for a guy who campaigned to sweep the special interests outta town. The Wilson connection is more subtle, in that Schwarzenegger does not want to be known as Pete Wilson's third term, but rather as his own man, running his own show. But Clarey has what Schwarzenegger needs. She knows the Capitol, knows the system, and she is smart, tough and organized. She was the "bad cop" to Bob White's "good cop" when she served as White deputy chief of staff under Wilson. White was schmoozer, the man about town, the governor's alter ego. He stayed above the fray except when his intervention was required, and when it was, he wasn't beyond bringing the hammer down on people. But Clarey was the day-to-day manager, the detail person, the enforcer, the one who was often asked to deliver the bad news. She performed a similar role in the campaign, well enough to impress the new governor with her skills. Clarey is not the kind of person who craves publicity. In fact, she hates talking to the press. So I think she will see her role in this administration, as any good chief of staff would, to see to it that the governor's will is implemented, at least as far as the edges of the vast executive branch. We will know more about how Schwarzenegger's views on state policy will be shaped when we see how he and Clarey fill out the rest of the staff. Insiders, meanwhile, already are wondering who will be paired with Clarey as the good cop in this administration, someone to smooth over the hurt feelings after the chief has had her say? My guess: Schwarzenegger.

Patricia Clarey has been appointed chief of staff by Gov.-elect Arnold Schwarzenegger.

The Bee says Gov.-elect Arnold Schwarzenegger is “intrigued” by a proposal from LA developer, Democrat, Davis supporter, and now transition team member Eli Broad to create a special bipartisan commission to examine the budget and recommend a mega-solution with painful measures normally opposed by members of one party or the other, or both. The idea is that the commission would put a plan before the Legislature with deep spending cuts and “structural reforms” – read, tax increases – and lawmakers would then vote up or down on the package without amendment. The commission idea is modeled after the method Congress used to eliminate obsolete military bases, and a proposal Sen. Tom McClintock has long pushed to kill off unneeded portions of the state bureaucracy. But the idea of including tax increases in the plan would probably kill it with members of the Legislature’s Republican caucuses, who oppose revenue raisers on principle and believe the budget ought to be balanced with cuts and borrowing alone. And while some form of a commission – namely the kind McClintock proposed – might have appeal as a way to get at obsolete but protected state functions, the version Broad is pushing would be a political trap for the new governor. Schwarzenegger ran on the idea of providing strong leadership. If, instead, he backed this notion, the new governor would be handing over his most important responsibility to an unelected body of experts and fixers. He would be left to twiddle his thumbs in the governor’s office for weeks or months waiting for the august body to deliver forth its fiscal dream, which he would then be under immense pressure to support, no matter what was in it. Intriguing idea or not, something tells me that Eli Broad will soon be joining investment guru Warren Buffett on the sit-up pad Schwarzenegger reserves for Democrat moneymen who urge him to raise taxes.

Gray Davis has appointed David Rosenberg, with whom he has worked off and on since their days in the Jerry Brown Administration, to a judgeship on the Superior Court in Yolo County. Rosenberg, 56, is a Yolo County supervisor and director of Community and Intergovernmental Relations for the governor's office. He has served as chairman of the state Lottery, chairman of the California Law Revision Commission, acting Chairman of the Victim Compensation and Government Claims Board, member of the Commission on State Mandates, chairman of the Yolo-Solano Air Quality Management District and member of the Council on Criminal Justice. He was deputy executive secretary and deputy chief of staff for Brown, serving under Davis, from 1976 until 1981.

Common Cause's Recall Money Line newsletter notes that for the second time in a little over a month, "an Indian tribe has reached an agreement with the Davis administration on a compact to permit casino gambling within days of making a substantial contribution to the campaign to keep Davis in office."

The pact with the Fort Mojave Tribe announced Monday was agreed upon on Oct. 3, according to a San Diego Union article, four days after the tribe donated $25,000 to the committee defending Gov. Gray Davis and the same amount to Bustamante. It was the first time that the tribe had made a major political contribution in California, according to Common Cause. In September, the group said, the La Posta Tribe made a $50,000 contribution to Davis, also its first, just nine days after signing a compact.

"This certainly gives the appearance that making a financial contribution to save the governor's job was an unwritten component of the compacts negotiated during the recall," says executive director Jim Knox.

NOTE: Unfortunately, Common Cause's newsletter is not online.

State Treasurer Phil Angelides says Gov.-elect Arnold Schwarzenegger must quickly provide a “Plan B” to ensure that the state can pay its bills if the courts strike down $13 billion in borrowing on which the 2003-04 budget was built. Angelides, in a press conference in his Capitol office, said no one can guarantee that two major bond measures under challenge in the courts will survive legal scrutiny. If the bond sales are struck down as illegal or otherwise tied up in litigation, the state will lack the cash to pay other debts due in June and will see that $13 billion added to its year-end budget deficit. The treasurer says Schwarzenegger must decide almost immediately if he wants to fight the lawsuits, settle them or drop the state's plan to sell the bonds without voter approval, which is the issue at the center of the legal dispute. But Angelides also says he is skeptical of a plan under consideration by Schwarzenegger to restructure the debt and place a new bond measure to cover it before the voters in either March or November of 2004. The treasurer, a Democrat who is considering running for governor in 2006, has said in the past that he thinks any budget solution should include a tax increase. He said Tuesday that a temporary tax increase on those making $250,000 or more per year could pay off the debt in five years. He also said he believes that further spending reductions are possible, and he urged Schwarzenegger to try to reduce the size of the state's structural budget gap before refinancing the debt. Asked whether he thought Schwarzenegger could rescind the recent increase in the car tax, preserve education spending as he has promised and still balance the budget without a tax increase, Angelides said: “I think it’s very tough. The math is very difficult.” The treasurer said he spoke by phone with Schwarzenegger last week and found him “plugged in” and “very attuned” to the state’s shaky fiscal situation. The two plan to meet in person later this week.

NOTE: This item was revised after posting to clarify the treasurer's comments on a possible tax increase.

Gray Davis reaches a deal on a compact for a Southern California gaming tribe. The Bee's story suggests it's consistent with the kind of agreements Schwarzenegger has said he would like to reach with the Indians.

The Times (registration required) says the compact doesn't meet Schwarzenegger's standards, and adds that more may be coming before Gray leaves office. Ultimately, any compact signed now will have to be ratified by the Legislature and signed into law by the new governor before it takes effect.

Gov.-elect Schwarzenegger is scheduled to return to the limelight this week with his first visit to the Capitol since the election, including a series of meetings with legislative leaders Wednesday and a sit-down with recalled Gov. Gray Davis on Thursday. Schwarzenegger has kept a fairly low profile since Oct. 7. After two press conferences in two days to bask in the victory and introduce his transition team, he jetted off to his Sun Valley, Idaho vacation home, where the ski slope named "Arnold's Run" suddenly has taken on a whole new meaning. There he relaxed for the weekend with his family, recharging his batteries after the draining, 62-day campaign while keeping in touch by phone with his transition staff back in California. Last week’s only public appearance was his meeting with President Bush in Riverside and the new governor’s introduction of the prez in San Bernardino, followed by a short solo press conference to talk up “mutual trust” and state/federal relations.

In private, meanwhile, Schwarzenegger has been meeting to shape his governing team with a close circle of advisers, the most important of whom are his wife, Maria, and longtime friends Paul Wachter and Bonnie Reiss. Wachter, who is Schwarzenegger’s personal financial adviser, has known him since 1981, when they met through Maria’s brother Bobby. Wachter began managing the actor’s financial portfolio in the mid-1990s and served as his spokesman on personal financial issues during the campaign. But his influence now extends beyond money. Reiss, a former entertainment industry lawyer and environmental activist, also came to Schwarzenegger more than 20 years ago through her friendship with Maria. She later emerged as the key person in the growth of Schwarzenegger’s favorite charity, the Inner-City Games, for which she has served as CEO and as a member of the board of directors.

Maria Shriver, Bonnie Reiss and Paul Wachter are Schwarzenegger’s anchors, the people who were with him before politics and will be with him after. When they speak, he knows they have his interests at heart. Outside that very close personal circle, the most influential adviser is surely Bob White, the longtime alter ego of former Gov. Pete Wilson and a political mentor to Schwarzenegger since the early 1990s. Rep. David Dreier, the head of the transition committee and a key campaign adviser, serves as something of a balance to White’s Wilsonian instincts, with Republican Senate leader Jim Brulte, a recent addition to the team, an increasingly important part of the mix. Campaign message men Mike Murphy and Don Sipple, neither of whom will enter the government, remain on good terms with Schwarzenegger and will keep him apprised of how he’s doing politically.

While the 65-member transition committee was thrown together hastily and had the unmistakable mark of the Wilson team that helped run the campaign, Schwarzenegger made at least one interesting mid-course adjustment, personally calling Fresno Mayor Alan Autry and asking him to “Join Arnold” after criticism that the list was heavy on Sacramento insiders and light on Central Valley representation. But the transition committee, as everyone knows, is mostly symbolic anyway, with its only real function being to funnel potential appointees the governor's way and, in this case, assess the condition of the various state agencies that the governor-elect will soon direct. Schwarzenegger's real focus the past 12 days has been on the first and perhaps most important decision he will make as governor: naming his chief of staff.

The position is crucial in any government, because the chief-of-staff sets the tone for everything that happens inside the administration. He or she generally serves as the gatekeeper, deciding who sees the governor and who does not. The chief also oversees hiring of the lesser positions on the governor’s personal staff and screens those whose selection requires the governor’s involvement. And this is the person who will help Schwarzenegger decide how much of his ambitious agenda he can tackle, and when.

The governor-elect will want someone who is loyal and long known to him, knows the Capitol and California politics, can manage a huge operation with good people skills and is not afraid to take chances and be bold in implementing Schwarzenegger’s vision. But there is probably no single person who meets all those needs. So he is going to have to choose between someone he knows and trusts implicitly and someone who knows their way around the Capitol but is not as personally familiar with Schwarzenegger's inner thinking.

Some around Schwarzenegger have thought that Reiss would make an inspired choice. Probably no one other than Maria knows Schwarzenegger's professional side as well as Reiss does. Like White did for Wilson, she probably knows Arnold well enough to guess, accurately, what he would do on countless decisions too small to bring to his attention. But her lack of government experience or a big-time management background would make her a risky choice. As would her recent appointment as a director of a major Las Vegas casino company -- a sore point with the Indian gaming tribes with which Schwarzenegger tangled during the campaign. And it's not even known if she would want the job.

An early candidate from outside the inner circle, recommended by White, was Russell Gould, a former finance director and health and welfare secretary for Wilson who since the mid-1990s has been a director with the Los Angeles-based investment firm MetWest, where he has been heavily involved in managing the assets of the Getty Trust. But Gould, friends say, is reluctant to leave his high-paying post and relatively sedate lifestyle for a return to the intense, 24-7 environment of Capitol politics.

Another top candidate, lately emerging as the favorite, is Patricia Clarey, a make-the-trains-run-on-time White deputy during the Wilson years who filled the same job on the Schwarzenegger campaign, which she joined after taking a leave of absence from her post as government relations VP at the health insurer HealthNet. Clarey would be a safe choice: smart, qualified, experienced, a known quantity. She worked for Reagan and the first Bush in Washington before moving west to join the Wilson team. Her selection would raise few eyebrows, other than for the Wilson connection, and perhaps her long ago role as a Chevron Corp. lobbyist. Which is probably just the way she’d like it. Clarey's relative anonymity is something that no doubt makes her an attractive candidate for the job.

But -- and this has to be the caveat in every Schwarzenegger item -- the world learned on Aug. 6 that Arnold loves head-fakes. So I wouldn’t be shocked if he switched gears at the last minute and went with some kind of eye-popping, out-of-the-box selection that caused everybody to stop and say “Wow!” He did name Willie Brown to his transition team, after all.

The Bee takes a look at Schwarzenegger fiscal adviser Donna Arduin's record trimming budgets in Florida, New York and Michigan. She's described as a woman with a good heart but one who is not afraid to slice health and social services to the poor in the quest to balance a budget.

Democrat Atty. Gen. Bill Lockyer says he voted for Republican Arnold Schwarzenegger for governor. Lockyer, speaking at a recall post-mortem at UC Berkeley, said he opposed the recall but chose Schwarzenegger in the replacement election because he stood for "hope, change, reform, opportunity, upbeat problem solving." He added, "I want that. I'm tired of transactional, cynical, dealmaking politics." Lockyer, considered a frontrunner for the Democratic nomination for governor in 2006, would have had to challenge an incumbent of his own party had Lt. Gov. Cruz Bustamante been elected this year. Lockyer didn't directly criticize Bustamante Saturday but said he looked at the list of candidates and it was "a crappy list." Lockyer said his vote for Schwarzenegger was his first for a Republican in a partisan race in his life. "I hope I haven't been conned," he said.

UPDATE: In comments to reporters after his speech, Lockyer had this to say about why he didn't vote for his fellow Democrat: "You know the people in your profession really well. You know who works hard and who doesn't. You know who is honest and who isn't. Cops know that about cops. Doctors know that about doctors. I know that about politicians. The common thing to all these professions is none of them say it. That's all I'm going to say."

Arnold and the schools: Every new California governor takes office with a pledge to respect local control of the schools. And every one of them then signs legislation increasing Sacramento control over the schools. The advantage of the accountability movement begun by Pete Wilson, expanded by Gray Davis and endorsed by Arnold Schwarzenegger is that it allows the state to set consistent standards, assess how those standards are being met and then hold the schools accountable for their performance. It also should allow the state to free local schools to meet those standards more or less as they see fit. But that part hasn’t happened. Schwarzenegger, like his predecessors, says he supports local control. Among other things he wants to cut the strings on millions of dollars the state sends the districts in “categorical grants” limited to specific purposes. Davis proposed something similar but backed down when he met opposition from narrow groups that wanted to preserve the mandates. It will be interesting to see if Schwarzenegger stands by his pledge. Here is an AP story that takes an early look at his views on education.

Foiled by the radio gods: I am blogging today from beautiful Mendocino, where I’ve come today to talk to a local group about the recall and the future of California politics. After a relaxing morning stroll along the bluffs, I found a wireless-ready locally owned coffeehouse (no Starbucks allowed here!), and I’ve set myself up with a latte, a muffin and my laptop. My drive over Thursday night was marred by my belated discovery that no Northern California radio station was airing the seventh game of the American League Championship Series live. The horror! What made it even worse was knowing that two stations I knew of had access to the game and were choosing not to air it, relying instead on local programming, mostly sports talk. A Sacramento sports radio station had two talkers on after the NBA Kings’ pre-season game, and, as if to torture their listeners, the hosts were groaning and grunting about the game as they watched the Yankees comeback on television without telling us what was actually happening. A San Francisco station, meanwhile, had an interview with the former owner of the 49ers, who assured Bay Area football fans that the team would still be competitive if he were still in charge. I lost contact with the Sacramento station as I approached the coast, and the San Francisco station finally put the game on as it reached extra innings (showing great courage by postponing their weekly “Fantasy Football” hour). But this station insisted on cutting to its local host between innings, and he would say a few words before sending listeners back to the network feed. Of course, he waited too long in the middle of the 11th, and when he sent us back, all we got was play-by-play man Jon Miller recapping Aaron Boone’s first-pitch, game-winning homerun. Idiots.

UPDATE: I asked one of the clerks at the coffee shop if their wireless hotspot was popular. He said, well, yeah, with the people who know it's here. We don't really advertise it, he said. Seems that people in these parts might not like the idea. The

Schwarzenegger, Bush meet in SB: Schwarzenegger and Bush have made their first joint appearance since the recall election. Introducing Bush in San Bernardino, Schwarzenegger said when he arrived on these shores 35 years ago, he never dreamed he'd one day be governor and introducing the president. But California, he said, "is a place of great dreams." His current dream is to get a few billion out of the federal government to help him balance the budget. He mentioned the state's "serious challenges" and said California has "no greater ally" in Washington than Bush. The president, in turn, after joking that "some accuse both of us of not being able to speak the language," predicted that Schwarzenegger will be "a fine and strong leader for California." No specifics, of course, and don't expect any when the governor-elect holds a press conference a few minutes after Bush's speech.

Matt Miller in this commentary correctly skewers the Schwarzenegger argument that California deserves more federal money because it has been paying in more than it gets back from Washington. But Schwarzenegger's argument on the burden of illegal immigration is more specific, and more credible. If he succeeds in his drive for more federal money, it's going to be after a finely choreographed campaign involving several big states with high levels of immigration.

Today he will probably just say that he began to lay out his case and the president was open to his arguments.

McClintock protegé and ally Tony Strickland announces that he will challenge Barbara Boxer for the U.S. Senate next year. I expect former Secretary of State Bill Jones to be next to announce, and to emerge as the establishment choice for the Republican nomination.

The California Broadcasters Assn., sponsors of the widely watched Sept. 24 debate, held a session Wednesday night to review the event and the reaction to it. CBA director Marc Powers said estimates suggest that half the televisions that were turned on in California that night were tuned to the debate. The CBA received nearly 50,000 e-mails and 10,000 letters about the event. Reviews were generally positive. Three out of four who wrote in said the program was either informative, entertaining and/or a valuable tool for making their decisions. Two out of three liked seeing the questions come from voters, and half said they liked the fact that the questions were released in advance. As for moderator Stan Statham: two out of three said what Powers described as "a good job under the circumstances." The CBA is hoping to sponsor a similar debate during next year's U.S. Senate campaign.

The Bee reports that at least eight local television stations have decided to open bureaus in Sacramento to cover the Schwarzenegger Administration -- or at least the start of it. The betting has already begun on when they'll grow bored and leave town again. I hope they stay. It's been 15 years since the last outta town TV news bureau pulled up stakes. I think the light they shine on the process is needed to help keep voters informed about their government.

Controller Steve Westly, a first-term Democrat thinking about running for governor in 2006, reached out today to Gov.-elect Schwarzenegger on several fronts. Westly, after having some fun offering a mock screenplay for the new governor (“The Road to Reform”) along with a director’s chair and fresh hot popcorn on the Capitol steps, said:

-- He agrees that Schwarzenegger, or his director of finance, can reduce the car tax by administrative order, but he encouraged Schwarzenegger to reimburse cities and counties from the state budget for the loss of revenue.

-- He thinks the Schwarzenegger audit is a good idea but wants to go further, proposing performance audits of every state agency to determine whether the taxpayers are getting their money’s worth.

-- Endorsed a bigger budget reserve, stricter spending limits and the withholding of salaries for top state officials when a budget is late.

Westly also endorsed redistricting reform, which Schwarzenegger has proposed, and called on the new governor to back his open primary initiative.

“We have a logjam in Sacramento,” Westly said. “We need to break that. I get it.”

The Washington Times speculates that Rep. David Dreier, political-friend-in-chief to the new gov, might challenge Barbara Boxer for the U.S. Senate next year.

This isn't set in stone, but I am hearing that the most likely date for a Schwarzenegger swearing in is Nov. 17, a Monday.

Wesley Clark has come from nowhere to vault into the lead among Democrats competing in the California presidential primary, a new Field Poll shows. Clark is the choice of 17 percent of California Democrats, ahead of both Howard Dean and Joe Lieberman, who are tied at 14. Dean had built a big lead before Clark jumped into the race. In the last Field Poll, the former Vermont governor led Lieberman 23-15. Kerry, who was third, drops to fourth. The poll also shows Bush competitive in California with all the major Democrat contenders, with the president holding small leads over Dean, Kerry, Lieberman and Gephardt while trailing Clark narrowly. Here is the entire poll.

While many people at the impression that the Legislature and Gray Davis were rushing to enact their agenda both before and after the recall election, that didn't show up in the numbers. Or maybe they concentrated on the big stuff. Anyway, Davis signed fewer bills into law this year than any governor dating back to Ronald Reagan, according to longtime state Senate staffer Peter Detwiler, who keeps a record of the annual stats. Below are the highlights of this year's Detwiler report:

Davis signed the lowest number of bills of any recent governor, just 909 in 2003.

Davis also signed the second-lowest number of bills of any recent governor (948 in 2001).

The highest percentage of bills vetoed (24.91%) came from Davis in 2000.

The most vetoes in a single year (436) came from Deukmejian in 1990.

Deukmejian also vetoed the most bills (2,298).

In five years, Davis vetoed twice as many bills (1,098) as (Jerry) Brown did in his eight years (528).

In 1982, Brown vetoed just 30 bills, setting the record for the lowest number of vetoes.

Wilson signed the fewest bills of any recent (two-term) governor; 9,324 over eight years.

But Davis holds the record for the lowest annual average (1,029 a year over five years).

The five years with the highest number of chaptered bills were all with Republican governors (1971, 1984, 1967, 1990, 1988).

Although usually regarded as political conservatives, Deukmejian and Reagan actually signed more bills than Brown, the more activist liberal.

Most odd-numbered years have fewer new laws, probably because they are the first years of two-year legislative sessions. There are four exceptions: 1967, 1971, 1985, and 1993.

Former Gov. Pete Wilson and former Assembly Speaker Bob Hertzberg will discuss the recall and its implcations for the future at a forum at the Mayflower Hotel in Washington on Thursday. The discussion is scheduled to be webcast at 1:15 p.m. Pacific Time here.

More names floated in the Arnold chief of staff derby, with the understanding that in jobs like this, it’s often the name that never surfaces that matters most:

-- Kathleen Shanahan, a former Wilson administration official who also worked for the Bush 41 campaign in 1992 and for Dick Cheney during the 2000 presidential campaign. She recently resigned as chief of staff to Florida Gov. Jeb Bush after serving in that post for three years.

-- Patricia Clarey, former deputy chief of staff to Wilson, and Bob White’s deputy in the Schwarzenegger campaign operation. Clarey took a leave from her job as vice president for governmental relations for HealthNet to work for Schwarzenegger.

Also, a number of members of the transition committee are pushing for the selection of Cassandra Pye, vice president for corporate affairs at the California Chamber of Commerce, where she has been the political eyes and ears for the chamber for several years.

Columnist Jill Stewart publishes her own response to Los Angeles Times editor John Carroll's comments on the Schwarzenegger groping stories, and adds a long interview with a Times' insider describing the investigative team that was let loose on "the actor." These two items, especially the insider's take, will be must reading for people who can't get enough of this story behind the story.

I have defended the original Times groping story and don't believe allegations that the piece was held for effect. But as all the dust settles, I do think two key questions about the paper's coverage have yet to be fully answered:

-- Why didn't The Times dedicate equivalent resources to investigating reports of Davis' ill temper and his treatment of his subordinates?

-- Why, if it took The Times seven weeks to confirm its first six allegations of groping, was the paper able to get 8 more charges into print in a matter of days after its expose was published?

The Bee's Aurelio Rojas takes a look at Schwarzenegger's potential relationship with the Legislature's Latino caucus, including hints of a possible compromise on driver's licenses. Republican Assemblyman Abel Maldonado also suggests that Schwarzenegger can win 60 percent of the Latino vote if he runs for reelection in 2006.

Russell Gould, managing director of MetWest Financial and a former official in the Pete Wilson Administration, is a leading candidate to serve as Arnold Schwarzenegger’s chief of staff, my sources tell me. Another way of putting that: the Schwarzenegger braintrust would love to have Gould, but it's not clear at all that he would like the job. Gould long ago left the government grind behind for the rarified air of corporate finance, also serving for a time as senior vice president at the J. Paul Getty Trust. But if Gould could be coaxed out of his high-paying Los Angeles job for a return gig in Sacramento, he would be an interesting choice. He was Wilson’s first Health and Welfare Secretary, and in that post oversaw the difficult budget cuts of the early 1990s recession as well as the first pass at welfare reform in California, long before it emerged as a big national issue. At the same time he helped Wilson fashion a “preventive agenda” aimed at getting kids off to a good start in life with prenatal care, early childhood health care and other school-based programs. In short, he helped Wilson shape a compassionate conservative agenda for California before George W. Bush ever heard of the term. Both the compassion and the conservatism would probably appeal to California’s new governor, who must find a way to make serious cuts in programs while also living up to his promise to make children’s issues the top social priority of his administration. Gould, who was also finance director for Wilson, was never known as a terribly political animal, though, judging by his rise from state bureaucrat to high-flying financier in less than a decade, he obviously knows a thing or two about dealing with people. Los Angeles-based MetWest reportedly has more than $50 billion in assets under its management, and its clients include Boeing, Microsoft and the California Public Employees Retirement System.

Other names being floated for the top job also have Wilson connections. They include Gary Hunt, a longtime Wilson associate and former vice president of the Irvine Co., and Bill Hauck, a former Wilson special assistant who is currently president of the California Business Roundtable -- a group that opposed the recall. The only non-Wilson name I have heard, former Assembly Speaker Curt Pringle, currently the mayor of Anaheim, seems like a longshot at this point.

In one of his final decisions on legislation as governor, Gray Davis late last night vetoed SB 328, which would have allowed low-income illegal immigrants to have their fees waived at California Community Colleges.Here is a PDF file of the governor's veto message. More on this and other last-minute vetoes and signings as the dust settles on about 200 bills Davis acted on over the weekend.

Don't miss Matt Labash's deliciously detailed account of the final days of the Schwarzenegger campaign, as told from a pack of hundreds of journalists with no access to the candidate and nothing of substance to write about. At the Weekly Standard.

This LA Times story based on exit polling in the recall suggests that Democrats might have a hard time keeping upwardly mobile Latinos in their camp. As Latinos' income goes up, so does their tendency to vote Republican.

Here is a Chronicle story on Schwarzenegger's plan for straightening out California's energy mess. Another proposal he made during a campaign that was supposedly substance-free.

Rick Hasen has been tracking several analyses about how the undervotes in the recall election varied across different kinds of voting systems, and what that might tell us. His latest take is here.

Gray reads the Top 10 list on Letterman tonight. Sneak preview from the governor's office:

TOP TEN PIECES OF ADVICE GRAY DAVIS HAS FOR ARNOLD SCHWARZENEGGER

10. "WHEN YOU REALIZE YOU DON'T KNOW WHAT YOU'RE DOING, GIVE ME A CALL"
9. "BABY OIL WILL STAIN THE MANSION'S ITALIAN SILK SOFA"
8. "LISTEN TO YOUR CONSTITUENTS - EXCEPT MICHAEL JACKSON"
7. (SORRY, JOKE NUMBER 7 WAS RECALLED)
6. "TO IMPROVE YOUR APPROVAL RATING, GO ON LENO - WHEN YOU GET KICKED OUT, GO ON LETTERMAN"
5. "STUDY THE MASTER - GEORGE W. BUSH" (laughs) "AH, I'M JUST KIDDING"
4. "YOU COULD SOLVE THE DEFICIT PROBLEM BY DONATING YOUR SALARY FROM 'TERMINATOR 3'"
3. "IF THINGS ARE BAD, JUST YELL, 'SAVE US, SUPERMAN!'"
2. "WHILE GIVING A SPEECH, NEVER SAY, 'SANTA CRUZ, SANTA BARBARA...SAME THING"
1. IT'S PRONOUNCED 'CALIFORNIA'"

Gov. Gray Davis will be signing, and presumably vetoing, legislation through the weekend leading up to his midnight Sunday deadline for taking action on bills sent to his desk at the end of the legislative session. His office just announced that Davis has signed 66 bills. Look here for a list of those measures soon, and for updates through the weekend.

Still catching up on loose ends. This New Democrat newsletter from the Democratic Leadership Council cautions party members not to go to war with Schwarzenegger but to hold him accountable while also tending to big problems of their own. Money quote:

"Democrats also need to tend to their own garden and take very seriously the decision of California voters -- who still decisively tilt Democratic in party identification and overall policy views -- to support what began as a nutty right-wing crusade and ended as a popular movement. They need to regain their centrist, problem-solving reputation, and must absolutely reverse the recent perception that they don't give a damn about anybody who doesn't belong to a reliable Democratic constituency group. California voters can help both parties move away from the current polarization by approving a ballot initiative next year that would bring back an open primary system -- re-enfranchising moderate and independent voters, and re-engaging today's isolated parties in a competition to win elections through new ideas and successful governance."

The suburban Sacramento offices of People's Advocate, where recall sponsor Ted Costa is the chief executive officer, were egged last night, according to Costa assistant Carl Burton. Burton said the windows and door of the office were covered with splattered eggs. The group has filed a police report on the incident.

Here is the complete list of transition committee members.

Arnold Schwarzenegger has chosen Donna Arduin, the director of Florida’s Department of Finance, to conduct the independent audit of California’s books he promised during the recall campaign. Arduin, a Duke University graduate who has also worked for the state of New York and Michigan and as an analyst for Morgan Stanley & Co., is taking leave from the Florida administration of Gov. Jeb Bush and donating her time to do the Schwarzenegger audit, according to transition spokesman Rob Stutzman.
While the scope of the audit isn’t yet clear, Arduin said she intends to complete it in time for Schwarzenegger to include her recommendations in his first budget, which must go to the Legislature by Jan. 10.

Don’t look for this to be the top-to-bottom examination of potential waste and fraud in state government. That will come later. Arduin, at least in the first pass, will probably limit herself to establishing a definitive number for the state deficit and listing all the borrowing, diversions, and tricks upon which the current budget rests. Look for her also to perhaps recommend a few structural reforms, including the spending cap Schwarzenegger wants, and possibly a way to restructure the state’s debt.

According to the transition team press release, Arduin in Florida has implemented a system where agencies and departments annually map out the cost and demand for each service they provide, with five-year forecasts for each. She favors performance-based budgeting under which departments attach “real-world performance measures” to each activity and connect outcome goals to budget dollars.

Here is an interesting and not too flattering view of her performance by a columnist at the St. Pete Times.

Gov.-elect Schwarzenegger today unveiled a transition team whose ideological breadth could bridge the Central Valley. It runs from Bill Simon on the right to Willie Brown on the left and includes just about every imaginable spot in between. Despite Simon’s presence, the team does not appear heavily weighted to the right. Most of the Republicans are of the more moderate stripe – people like former Assemblywoman Charlene Zettel and former state Sen. Rebecca Morgan. One of the more notable names on the list is Tammy Bruce, former president of the LA chapter of the National Organization for Women and a member of the group’s board of directors. She was a Schwarzenegger supporter during the campaign.

Others: Orange County Sheriff Mike Carona, Sen. Jim Brulte, Jon Coupal, president of the Howard Jarvis Tazpayers Assn., USC law professor Susan Estrich, former state Treasurer Matt Fong, LA Mayor Jim Hahn, former Assembly Speaker Robert Hertzberg, Robin Kramer, a former Dick Riordan aide, investor Gerald Parsky, who is Bush’s man in California, Cassandra Pye of the California Chamber of Commerce, and many more.

These lists are not always meaningful, of course. They are meant, more than anything, to set a tone and send early signals about a new administration’s direction. The names on the list become conduits for people seeking an appointment in the government. But Schwarzenegger has certainly, with this list, delivered the message that he intends to govern from the center while reaching out to both the left and the right.

Transition spokesman Rob Stutzman said legislative leaders have agreed on a $500,000 transition budget for Schwarzenegger (same as Davis and Wilson had) and a $100,000 budget for Davis to tie up his affairs.

The Oakland Tribune reports that veteran state Sen. John Vasconcellos, a longtime advocate of the self-esteem movement, thinks that the new governor is a "boob" and might quit the Legislature rather than serve alongside Schwarzenegger in Sacramento.

Trying to divine Gov.-elect Schwarzenegger’s likely moves on fiscal policy is a little bit like the old practice of Kremlinology, where analysts had to parse vague statements, watch personnel shifts and consider history to figure out what might happen next. One of the major stories of the campaign was that Schwarzenegger was being vague about his ideas on the budget. I said so many times myself. But now that he has been elected governor and I am trying to assess where he is going from here, I find myself coming back to his many statements during the campaign that gave us broad hints about the direction he intended to take. It turns out that he was more specific than we sometimes gave him credit for, if only you had time to use a careful ear and a bit of imagination. Stitched together and filled in by informed speculation, his fragmentary statements can be used to make some educated guesses about the near future. Would I prefer a candidate, or a governor-elect, who speaks more clearly, directly and specifically about his plans? Absolutely. But this is what we’ve got at the moment, so let’s make the best of it.

I’ve already written at some length about his hopes for federal money, which he mentioned several times during the campaign, even if it was largely ignored by the political press corps. I also think he has a decent chance of cutting a deal with the gaming tribes to contribute something to the state’s general fund.

Now I want to address something else he said over and over during the race: restructuring the state’s debt. What might that mean?

The current state budget rests upon billions of dollars in borrowing, shifts, accounting gimmicks and the like. The famous “audit” that Schwarzenegger mentioned repeatedly during the campaign is probably going to amount to a definitive statement of all of those smoke-and-mirror tactics and what they mean for the state’s fiscal condition. I don’t take literally Schwarzenegger’s comment that this audit will uncover the waste in government. That’s a project that will take months or years to complete. But unlike skeptics who laugh off the audit as a meaningless delaying tactic, I think it would be useful to have in one place at one time a comprehensive analysis of all the shifts and diversions in the budget -- legal and illegal -- to give us a complete sense of the state’s fiscal condition. The Legislative Analyst has done some of this kind of work, but I have seen nothing yet that lays out the entire picture in context.

Next, consider the two major pieces of the budget plan that are most at risk. A scheme to borrow money to pay the state’s obligation to its employee pension fund has already been struck down by a court on grounds that it violates a constitutional provision against borrowing more than $300,000 without a vote of the people. Another, much larger deficit bond is vulnerable to the same kind of legal attack and might yet fall as well. Together the two measures total $13 billion. If they are both struck down, the state will be essentially insolvent, with no ability to borrow to get the money it needs to pay its bills.

Suppose Gov. Schwarzenegger gets an audit which makes this clear and also lays out the looming $8 billion gap between projected spending and revenues in the fiscal year that begins July 1. Now let’s remember several other things he said during the campaign:

The accumulated deficit might be as large as “$20 billion.”
He wants to “restructure the debt.”
He wants to start over fiscally with “a clean slate.”
He wants to adopt a spending cap.
He wants to prohibit future deficit spending.

That’s actually quite a bit of specificity for a guy who supposedly never told us where he was headed. What he didn’t do was tie it all together for us. Now I will try to do that.

What if he does the audit, concludes that we have a $20 billion problem, says Davis tried to circumvent the will of the people by bonding without a vote, and asks the Legislature to put the following on the March ballot:

--A $20 billion bond to finance the accumulated debt and help cover the gap emerging in next year’s budget. (“Restructure the debt.”)
--A constitutional amendment to clearly prohibit future deficit spending without a vote of the people.
--A spending cap or reserve requirement to prevent this from happening again.

He could sell this plan as the only way to avoid big tax increases or devastating spending cuts, the only politically palatable way to get the state out of the fix left for him by his predecessor. It would find favor with Republican legislators who oppose tax increases (and were the first to propose the deficit bond this year) and Democrats who don’t want to vote for spending cuts. It would give the state time to grow out of its problem. And while it could be criticized as more deficit spending, if it were coupled with a spending cap and a clear ban on future borrowing without a vote of the people it could be described as short-term relief combined with long-term reform. It would probably get the support of every major interest group in the state, from labor to business to the anti-tax crowd that started the recall.

And it would be entirely consistent with everything Schwarzenegger said as a candidate.

One last thing: what got Davis in trouble was his lack of boldness, his refusal to attack problems before they became crises. The looming legal challenge to the deficit bonds is one more such disaster-in-waiting. A timid governor would wait and see if the courts strike it down, then be forced to react in a panic to pick up the pieces. A bold, forward-thinking governor would say, what can we do to avoid that kind of situation? The answer: go to the people proactively for the authority that only they can provide, settle the lawsuit, wipe the slate clean and then balance the operating budget going forward.

Late last night, just before Gray Davis conceded defeat in a gracious speech, I spoke at his event with Sen. Sheila Kuehl, the Santa Monica Democrat who hopes to replace John Burton next year as leader of the state Senate. Kuehl is a partisan liberal, head of the “Progressive PAC” that raises money for leftist Democrats running in legislative primaries. She is also usually level-headed, pleasant, intelligent and courteous. Last night, she was none of the above. Here is an excerpt from our interview:

DW: How are you feeling?

KUEHL: I am really sad. I’m more angry than anything. And I haven’t even started thinking about what the Senate will need to do in order to save the state.

DW: Save the state from what?

KUEHL: From ignorance. This guy has no idea how to run a state. One of two things will happen. He’ll have his own ideas and no way to carry them out. I mean he has already proposed three things that the governor cannot do. He wants to roll back the car tax on his own by fiat, which he can t do. He wants to tax the Indians, which he can’t do. He doesn’t know anything about running the state. So either he will propose a lot of stuff he can’t do and we’ll have to govern, or he’ll be pretty well manipulated by people who have an agenda, very much the way I think the president of the United States has been handled by people who are really telling him how to do these things. In which case we may have to counteract things that are worse than things he proposed on his own. His handlers will probably be more conservative than he is, or in the Republican Party line. Convince him he’ll bring businesses back to the state by cutting more benefits to workers, by unraveling anti-discrimination statutes which they call job killers.

DW: Will he be received civilly by the Democrats in the Legislature?

KUEHL: He will be received civilly. We have received everyone civilly. I don’t know if everybody is going to go to the State of the State (speech). Because frankly I don’t think there is going to be a lot of content that anyone’s interested in. What’s this guy got to say to us about the state of the state? Nothing.

Schwarzenegger won a plurality in 50 of the 58 counties, and took an outright majority in 36 of them. All of the counties where he finished second to Cruz are clustered around San Francisco Bay or around the north and central coasts. His best county was Sutter, the rural county north of Sacramento, where he got a whopping 65 percent of the vote. Interestingly, the better Schwarzenegger did in those counties, the better McClintock did too. In a handful, Tom finished second. Here is the map.

California has its own version of the blue-state, red-state breakdown, only here the breakdown comes by counties, and the Secretary of State's map colors them green and red. Just 15 of the state's 58 counties opposed the recall yesterday, and eight of them were on the coast. Six of the remaining seven were either continguous to a coastal county and immediately inland, or touching San Francisco Bay. Yolo County, which was 49.8 percent "yes" as of 6:40 this morning, was the only "inland" county for Gray. And other than Los Angeles County, which was 51 percent "no" on the recall, the southernmost county for Gray was Monterey. I will come back with the precise numbers on this, but it appears that if you took away Los Angeles County and those counties which touch SF Bay, the recall would have passed 60-40, and perhaps by an even greater margin. See the map here. Remember to refresh the page.

Among Latinos, 46 percent voted for the recall, while Schwarzenegger (31 percent) and McClintock (9 percent) combined took 40 percent in the replacement election, according to the Edison Media Research/Mitofsky International exit poll commissioned by Associated Press and a consortium of media. Bustamante got 52 percent of the Latino vote.

The LA Times exit poll suggests that the groping stories had an effect: those voters who say they made up their minds before last weekend went 56-44 for the recall and 50-32 for Schwarzenegger over Bustamante. Those who decided last weekend or later went 51-49 for the recall and 38-34 for Schwarzenegger over Bustamante. McClintock's vote went from 13 to 16 and the other candidates rose from 5 percent to 12 percent. Here is a PDF with the full report.

"It was the triumph of the swill," --Gray Davis pollster Paul Maslin, describing Schwarzenegger's victory with a nasty and feeble reference to Leni Riefenstahl's famous 1934 documentary on the rise of Adolf Hitler.

Schwarzenegger's transition team is taking shape, and at least at the top, it is conspicuous by the absence of veterans of the Pete Wilson operation. Rep. David Dreier, the San Dimas Republican, will be chairman, with Jim Richardson, an aide to Senate Republican Leader Jim Brulte, serving as staff director. Rob Stutzman, who was the party spokesman before shifting to the Schwarzenegger campaign, will handle communications. And Dreier's chief of staff, Brad Smith, will also play a key role. Also, look for details to emerge on Schwarzenegger's promised audit of the state's books by week's end.

"It's going to take more than a broom to clean things up in Sacramento," -- Democratic Assembly Speaker Herb Wesson.

I’ve just finished watching Gov. Gray Davis’ concession speech at the Biltmore Hotel, and I have mixed feelings about what has transpired tonight. Even though I knew in my bones that this was coming, even though it seemed inevitable from the time the petitions were certified, if not before then, it still was a shock to the system to see it happen. It is sad, in a way, that the state’s public affairs are in such terrible shape that it has come to this. Despite my feelings about the job Davis did as governor, and my role in documenting his failures, I have little joy in my heart tonight. It is almost as if the state’s voters have fired an employee for whom they once had high hopes, someone who didn’t work out the way we thought he would. That’s nothing to celebrate, when you think about it.

Davis in his concession speech showed class, congratulating Schwarzenegger and promising to cooperate with him during the transition. But his supporters were angry and nasty and in no mood to concede anything.

I understand the bitterness, but I’m disturbed by its depth. Several of the Democrats I spoke to were in strong denial about the message sent by the voters, the message being that they, and Davis, have been poor stewards of state government. They see this is an isolated event, a venting, that will quickly pass while they fight to maintain everything they have done the past five years. My gut tells me they are wrong, that there is something deeper here, a desire for fundamental change in the way the state does business and in the way politics works, or doesn’t work, in California.

They also seem to misunderstand Gov.-elect Schwarzenegger, and what he is all about. His rhetoric is harsh and often shallow, to be sure, but he has laid out a broad vision for the state that the people have accepted. Legislators will ignore that reality at their peril.

Partial transcript of interview with Davis a few minutes ago on CNN's Larry King Live. The gov is not exactly brimming with confidence.

KING: Was it difficult to walk into that booth and see your name listed among should the Governor Gray Davis be recalled?

DAVIS: Well, it wasn't my happiest moment, but I knew it was coming for a long time, so we put on the best campaign we could in 77 days, and even though California has problems, we've made some progress. The tax scores are up five years in a row. And we have a million more children with health insurance. We have the best environmental record in the country, and we're the strongest defenders of a woman's right to choose. So I know the critics complained, but some good things have happened in this state, as well.

KING: Are you surprised at the turnout?

DAVIS: Pleasantly, because I think the bigger the turnout, the more legitimate the results. If it's a big turnout, then everyone had a chance to have their say, and I obviously will abide by the results.

The voters have been good to me, electing me twice as governor, allowing me to serve 35 million people. I'm very grateful to them, very grateful for the opportunity to try and move the state forward, and whatever their judgment is tonight, I will accept it.

KING: So, if you lose, no deep regrets or bitterness?

DAVIS: No. I mean, you have to deal the cards -- play the cards you're dealt. I came in. We had a wonderful economy. We created 1.2 million jobs, everyone was happy. And 300,000 of those jobs we lost the last three years because the national economy has been in a recession, which has affected all 50 states. So it's been tough governing these last three years, but tougher on the people I represent. So I work every day doing whatever I can to improve their lives.

KING: If you do go down tonight, will you cooperate with the governor-elect?

DAVIS: Yes. That's an obligation, I believe. Governor Wilson cooperated in my transition from him to me, and I'll cooperate in the transition, if that's the voters' will, with whoever they choose tonight.

Reports are coming in from around the state that turnout is the heaviest anyone has seen in years. Some of the crowding may be because the number of polling places was reduced in some areas because this was a special election. But here is a stunner: I just heard a radio report from Monterey County saying that police have warned of a huge traffic jam in the northern part of the county. Why? Because so many people are heading to a polling place.

For all the venom hurled the LA Times’ way over the groping allegations, if Schwarzenegger still wins, he might want to thank the paper for doing him a big favor. With that many women out there making these charges, it was inevitable that the issue would surface in volume at some point. If The Times had waited until after a Schwarzenegger victory, should it come, the stories would have created a huge problem for the new governor and cast into doubt the legitimacy of his election. The “Recall Arnold” movement would have started with the groping charges as the foundation of their effort, claiming that voters never would have elected him had they known about his wandering hands. His opponents will still make that argument if he is elected, but now, because of his acknowledgement of bad behavior and his apology, he could credibly argue that the voters knew of his past when they voted and chose him anyway. That is, as long as nothing more serious emerges in the days and weeks ahead.

The Field Poll estimates a huge turnout, the highest number ever for a governor's race and the highest percentage of registered voters for a governor's race in 20 years:

“In today’s historic recall election The Field Poll estimates that as many as ten million California voters will be participating in the decision as to who they want as governor for the next three years. A turnout of this magnitude would represent a 30% increase over the 7.7 million voters who participated in the 2002 gubernatorial election and would be larger than any previous non-presidential contest in state history.”

Look for the whole thing here later this morning.

Here are the final results of the major independent polls that have surveyed California voters on the recall. The date of the last night of polling is in parentheses. The replacement results are listed in this order: Schwarzenegger, Bustamante, McClintock.

Source
Field (Oct. 1) 57-39; 36-26-16
Los Angeles Times (Sept. 29) 56-42; 40-32-15
Knight Ridder/NBC (Oct. 4) 54-41; 37-29-15
CNN/USA Today (Sept. 27) 63-35; 40-25-18
Survey USA (Oct.. 5)* 57-43; 46-34-13
Chamber of Commerce (Sept. 25) 53-41; 35-31-17
Knowledge Networks/Hoover (Oct. 4)** 59-41; 43-30-13

The Public Policy Institute of California, usually a major source on California public opinion, last polled on Sept. 17 and is thus not reliable at this stage in the race. For the record, the poll had the recall winning 53-42 with Bustamante leading Schwarzenegger 28-26 and McClintock at 14.

*Survey USA uses a unique form of polling with recorded voices asking the questions.
**This is an online poll using a random sample.

If anybody loves Gov. Gray Davis, it’s firefighters. He has supported them, giving their unions the right to binding arbitration, which has since been struck down by the courts, and the chance to bargain for pensions that will pay them as much as 90 percent of their salary at age 50. And they have returned the favor, showering his campaign with contributions and serving as the foundation for his campaign to beat the recall.

So it was only fitting that on Monday, in the final hours before the recall election, the governor joined hundreds of firefighters on a march through the streets of San Francisco to a rally in Union Square. On camera, the event will look impressive: a sea of firefighters clad in dark blue “no-recall” t-shirts cheering the governor of California. But 900 of those present were from out of state, attending a national symposium down the street at the Hilton Hotel. They can’t vote for Davis, and they’ll be too busy Tuesday at their conference to work on his behalf. About 300 others at the rally were from fire departments around the San Francisco Bay Area.

Union leaders and San Francisco Mayor Willie Brown delivered passionate speeches for the governor. And they implored the firefighters to help them get out the vote on Tuesday.

“We’re at war!” shouted John Hanley, president of the San Francisco firefighters union.

The international president, Harold Schaitberger, was more graphic.

“I am counting on you to get your asses out there tomorrow and light a fire under the voters of California,” he said. “We’re going to send a message to the Terminator: ‘You can go be the mayor of Muscle Beach but stay the hell out of Sacramento!'”

Mayor Brown, employing a bit of politician’s license, called Davis the greatest governor in California history, and predicted that the state will never see another one as talented as him. If the Democrats can get out the vote, he said, “the shock of everybody’s life will take place and on Wednesday morning Gray Davis will get back to governing this state.”

As Brown spoke, a man with an oversized Arnold Schwarzenegger mask strapped to his face, money in his hands and a large blue E symbolizing Enron pursued a woman dressed in pink around the plaza, groping her between faux slaps in the face.

Then Davis took the stage. He couldn’t match the passion of his warm-up speakers, but he was more animated than usual. He warned the audience that the car-tax cut Schwarzenegger is promising will mean deep cuts in city budgets and layoffs for half the police and firefighters in the state.

“Arnold Schwarzenegger is pulling the wool over your eyes,” Davis said. “He cannot produce a balanced budget. That’s why he says he’ll talk about that after the election.”

Davis added: “This is the time, this is the moment, to send a clear message to the country and the world,” he said. “Californians are fair. Californians are reasonable. Californians are decent people.”

The governor’s words were well received by the firefighters but failed to draw much of a crowd from beyond the center of the plaza -- the same problem, in miniature, that got Davis into this fix to begin with. Business people passed by without pausing to look up. Shoppers scurried in and out of Macy’s and Saks Fifth Avenue across the street. Tourists and passersby sat on benches, enjoying another glorious day in the city.

Charles Duff, 24, a student at San Francisco State University, sat with his back to the rally. I asked him what he thought of the recall.

“Crazy,” he said. “It’s crazy.”

What’s crazy about it? I asked him.

“The idea that you can take out a guy and have all these people running to replace him.”

So you’re going to vote against the recall?

“When’s the election?” he asked before answering the question himself. “Tomorrow, isn’t it? I don’t know. I have to work. I have to work most of the day.”

If Davis is recalled, one of the major stories on Wednesday might be the number of people who fail to vote for a candidate on the replacement portion of the ballot. This number could approach 10 percent of the electorate, which, depending on the turnout, would be somewhere between 800,000 and 1.2 million voters. And most of them are likely to be Democrats who vote no on the recall and then skip Question 2.

The effect of this drop-off could be stunning. Suppose turnout is 60 percent, and the overall electorate matches conventional wisdom and comes in at about 43 percent Democrat and 38 percent Republican. I actually think it might be bigger and more balanced than that, but for the sake of this analysis, let's be conservative. Those numbers would produce about 9 million voters. About 3.9 million would be Democrats, and 3.4 million would be Republican. The remainder are independents or minor party voters.

But then suppose 10 percent of those voters skip Question 2, and 70 percent of those are Democrats, and 20 percent are Republicans. That means you lose 900,000 votes, and 630,000 are Democrats and 180,000 are Republicans.

The new electorate for Question 2 now looks like this: 3.3 million Democrats and 3.2 million Republicans, or virtually even. Such an adjusted electorate would be a highly favorable environment for any Republican, and certainly for Schwarzenegger in this race. If, as his campaign says, Schwarzenegger is weathering the groping stories just fine, this extra bump could drive his final numbers far higher than any polls have shown to date. And if, as the Democrats claim, the groping stories are undermining his campaign, the drop-off on Question 2 could be what saves him. Even if the drop-off is only 5 percent, it could play a very significant role in the outcome.

Finally, there is another form of drop-off that could also be large and would have a similar effect, compounding the one described above. It’s the number of voters who cast a “protest” vote on Question 2 for one of the 130-some also-rans on the ballot.

The Schwarzenegger campaign was circulating poll numbers Sunday from the California Correctional Peace Officers Association that showed the recall still winning big and Arnold far ahead in the replacement race. According to the campaign, the recall was leading 57-37 in the last four nights of the tracking poll, from Wednesday through Saturday. Schwarzenegger was leading the replacement race with 36 percent, followed by Bustamante at 21 and McClintock at 17.

But those numbers didn't tell the whole story. A source outside the campaign who is familiar with that poll tells me that the daily splits are more revealing. According to this source, support for the recall slipped each night, from 63-30 on Wednesday to 54-41 on Saturday. In the replacement race, meanwhile, the shake-up was less dramatic. On that question, Schwarzenegger began the period up 32-19 over Bustamante and ended it up 39-26. McClintock is pretty much remaining flat in the mid to high teens.

Remember, ni