Arnie flexes muscle with economic plan

THE campaign to recall Governor Gray Davis steamed toward an October 7 vote after a federal judge rejected a delay over punch-card voting, while the leading Republican candidate, Arnold Schwarzenegger, outlined his economic plan.

The action star has surrounded himself executive-style with big-name advisers, while Republican Peter Ueberroth, the former baseball commissioner and key organiser of the successful 1984 Los Angeles Olympics, held a lean, straightforward news conference to offer his proposal.

Mr Davis, who went on the offensive this week with a speech blasting the recall as a Republican power grab, kept up the campaign to keep his job with a few jabs at Mr Schwarzenegger at a town hall-style meeting on Wednesday night before about 50 people in Hollywood.

"If someone wants to replace me, let's see a plan of how they want to manage the state, not just a couple sound bites," Mr Davis told a meeting at Raleigh Studios.

Meanwhile, a poll yesterday by the Public Policy Institute of California showed that 58% of likely voters would recall the Democratic governor, while 36% were opposed.

If he's removed, 23% would replace him with Mr Schwarzenegger and 18% with Democratic Lt Governor Cruz Bustamante.

None of the other 133 candidates topped 5%.

A federal judge in Los Angeles kept the recall on schedule by turning down arguments by American Civil Liberties Union lawyers that it should be delayed until March so that six counties can complete the replacement of old punch-card machines with more reliable modern systems.

"Because an election reflects a unique moment in time, the court is sceptical that an election held months after its scheduled date can in any sense be said to be the same election," said US District Court Judge Stephen V Wilson.The Schwarzenegger and Ueberroth plans were the latest put forth after general criticism of a lack of specifics from candidates.

Mr Schwarzenegger met with advisers, including former US Secretary of State George Shultz and billionaire investor Warren Buffett, before announcing his ideas during a televised news conference.

Californians are experiencing "the American dream slipping away" because of lost jobs that won't return unless the state creates "a positive business environment," the actor said.

Mr Schwarzenegger said he did not want to raise taxes, but would not rule it out. "It is clear that we can't ever say never," he said.

He said he would identify areas to cut after a special audit of the state's books "to find out how bad the situation really is."

As governor he said he would immediately call a special legislative session to reform workers' compensation and would focus on regulatory reform, energy reform and unemployment insurance fund problems.

Mr Schwarzeneggersaid he would support a constitutional spending cap as well.

Mr Ueberroth, who has vowed to only serve out Mr Davis' term and not seek re-election, said he would cut state spending across the board by 5% and create a one-time tax amnesty that would bring in $6 billion.