"It is poetic justice," said Garry South, a former Davis adviser, remembering Schwarzenegger's taunts before the 2003 election. "All the hullabaloo he made during the recall, putting up ads saying he would cut up the state's credit cards and stop this crazy deficit spending - and he ultimately didn't do either one."
Far from solving California's systemic budget problems, Schwarzenegger has taken several actions that have made them worse. Just like Davis, Schwarzenegger cut taxes but not spending, which has risen 30 percent since he took office. That ensured that when tax revenue tapered off, the budget gap would reappear.
The latest crisis came on so fast that California is in danger of running out of cash this year. Schwarzenegger has ordered more borrowing, with the sale of $3.3 billion in bonds, to make sure the state can pay its bills.
The out-of-whack budget forced the governor to scrap an ambitious plan to overhaul education, easily the biggest part of the budget, saying, "This is not the year to talk about money." California ranks 43d in the nation in spending per pupil.
The deficit also threatens to undermine the compromise on healthcare he reached last year with Democrats, a $14 billion plan that needs legislative and voter approval. The grim financial picture might make it harder to persuade voters and lawmakers to agree.
Schwarzenegger has tried his hand at reforming the budgeting process - at first gingerly, then with a campaign that incited such ferocious pushback it nearly ended his political career.
Shortly after he was elected, the Republican asked the Legislature to adopt a spending cap, but the Democrats who control both chambers refused. Lawmakers eventually agreed to put a weak spending limit on the ballot, along with a $15 billion bond issue to bail out the state. Both passed.
In the ballot pamphlet, Schwarzenegger assured voters - in capital letters - that the measure would be "a safeguard against this EVER HAPPENING AGAIN."
