But work on Schwarzenegger's agenda may be overshadowed next year by his failure to resolve the issue that helped bring him into office four years ago in a historic recall election – a chronic budget deficit. The governor entered office facing a $15 billion shortfall in a general fund that spent $79 billion. Avoiding deep spending cuts, Schwarzenegger used a voter-approved, $15 billion bond to plug a hole in a budget he inherited from former Gov. Gray Davis. Increases in tax revenue from a growing economy helped fuel spending since then. Schwarzenegger now faces an estimated shortfall of at least...
