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Last Updated: Wednesday, 7 January, 2004, 07:32 GMT
Schwarzenegger's 'no tax' promise
Arnold Schwarzenegger
Mr Schwarzenegger said he would use his fame to help raise funds
Arnold Schwarzenegger, California's governor, has sworn he will not use new taxes to sort out the state's finances.

In his annual "state of the State" address, Mr Schwarzenegger said that if legislators did not back his plans, the state would run out of money.

He insisted there was not a "budget crisis" but a "spending crisis".

But his Democrat critics said the hole in the state's books - which some estimates put at $12-$14bn - could not be bridged solely by slashing spending.

The new governor is seven weeks into his term, following his victory in the poll which followed the ground-breaking recall of his Democrat predecessor, Gray Davis.

'Blow up'

If I can sell tickets to 'Red Sonja' and 'The Last Action Hero', I can sell almost anything
Arnold Schwarzenegger
Mr Schwarzenegger's speech, interrupted over and over by Republican state legislators' applause, was strong on showbiz rhetoric.

He promised to put his fame to use selling the state worldwide, to keep businesses coming and money flowing in.

"I am a salesman by nature," he said, using two of his less successful films as an example of what he said he could do.

"If I can sell tickets to 'Red Sonja' and 'The Last Action Hero', I can sell almost anything."

His predecessors, he said, had got California into a mess by simply shifting spending around, rather than taking the axe to agencies he said were failing to serve a purpose.

"Every governor wants to move boxes around to reorganise," he said. "I want to blow them up."


The guts of the speech - which comes just 72 hours ahead of the state budget, due on 9 January - held to his election promises to avoid new taxes.

Indeed, almost his first action as governor was to repeal a $4bn rise in car taxes.

He urged voters to back a $15bn bond to cover the $14bn California needs to pay its creditors by June 2004.

That, he said, "would save our state from bankruptcy".

Recent polls, however, suggest that Mr Schwarzenegger may have to work hard to get the public to back the bond, which comes up for a referendum in March.

Arnold Schwarzenegger
"The state of our state will soon be strong because our people and our purpose are strong"

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