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Huge deficit, few options await Arnold
Associated Press Gov.-elect Arnold Schwarzenegger leaves the stage after a post-election press conference at a Los Angeles hotel Wednesday.

LOS ANGELES (AP) — Gov.-elect Arnold Schwarzenegger said Wednesday that he was promised "a very smooth transition" by ousted Gov. Gray Davis and vowed that he and his advisers would "open up the books" as they begin to tackle California's ailing economy.

In his first news conference since being elected governor, Schwarzenegger reiterated several themes from the campaign trail, insisting that he will not raise taxes and pledging to be a governor of the people. But he provided few specifics and said his transition team will develop a plan in the coming weeks about how to close a deficit of at least $8 billion.

"What we have to do is, open up the books … do the audit and find what the waste is," the action hero-turned-politician said.

Schwarzenegger said he had spoken with an array of leaders including Nelson Mandela of South Africa and President Bush, who Schwarzenegger said promised to do "whatever is possible to help California." Schwarzenegger said he intended to ask Bush for "a lot of favors."

The Republican actor will be sworn into the office by mid-November, becoming California's 38th governor.

Schwarzenegger has promised to fix California's ailing economy without raising taxes and while preserving education funding, which accounts for 40 percent of the state budget. But his proposals will have to go through a Legislature controlled by Democrats angry over what some of them consider a hostile takeover of the state's top political job. And he will have to quickly deliver a budget that can close the giant deficit.

It is an unusually fast transition, particularly for a political neophyte who declared his candidacy just two months ago.

"The last 60 days has been pretty difficult as well, but I would say there's probably never been a governor-elect who's stepped into a situation with the challenges he'll be confronting here in California. But that's why he wanted the job," spokesman Rob Stutzman said.

Schwarzenegger takes office as the Republican Party's lone statewide officeholder in a state where the congressional delegation and both houses of the Legislature are heavily Democratic.

And while the voters gave Schwarzenegger a resounding victory, they lean Demo-cratic, too — 44 percent to 35 percent Republican.

"I think he's in for a rude awakening to the fact that he won't be able to get done all the things he has said because politics just doesn't work that way," said Fresno resident Don Lesher, 71, a registered Democrat who voted yes on the recall and for Republican Tom McClintock. "Unfortunately, everybody is voting along party lines, rather than what's best for the state."

With 99 percent of precincts reporting, Schwarzenegger had 3,675,317 votes, compared with 2,415,098 for Democratic Lt. Gov. Cruz Bustamante. On the recall question, 4,332,808 voters, or 55.1 percent, were in favor of ousting Davis, while 3,531,091, or 44.9 percent were opposed.

Even if lawmakers and voters grant him a honeymoon period, Schwarzenegger's toughest challenges may loom in the form of his own campaign-trail promises.

In glowing stump speeches and high-octane rallies, Schwarzenegger told voters fed up with years in which they endured the energy crisis, budget deficits, rising fees and partisan gridlock that he would clean up Sacramento, bring back jobs and restore luster to Sacramento.

"For the first time, we'll have somebody who will probably listen to the people and figure out what it is that has to be done, not the same old thing the way politics goes," said Jim Hall, 62, as he worked out at a health club in Camarillo. "Bring on Arnold. He'll fix it. Gray Davis is history."

Schwarzenegger's toughest and first challenge: the looming, $8 billion deficit. It will grow by $4 billion if Schwarzenegger makes good on his promise to immediately repeal this year's tripling of the car tax. He has said he will not raise taxes except in case of emergency. He also promised not to cut education. But he never specified what he would cut.

Much of California's budget is committed to specific programs by law, leaving the new governor potentially little room to maneuver.

"He's got to tackle a budget crisis that if it could have been fixed by people far more familiar with the state budget than he is, it would have been fixed," said Darry Sragow, a Democratic strategist. "We're raising too little revenue for the amount of money we spend. He's going to have to raise taxes and-or cut programs.

"He's got a very, very difficult task in front of him, and he's never had any experience that's remotely like it."

Copyright © 2003 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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