Arnold's fiscal mess

Los Angeles Times:

Gov. Arnold Schwarzenegger is expected next month to seek immediate major cuts in state services, including a plan to take back $1.4 billion budgeted for schools this year and a proposal to slash the prison population by releasing tens of thousands of inmates.

The two strategies are among broad spending reductions Schwarzenegger will outline to address a projected $14.5-billion state budget gap. On Friday, the governor announced that he would declare a fiscal emergency Jan. 10, when he unveils his next budget.

State officials with knowledge of the governor's plans said cuts may be so deep that they could pave the way politically for tax increases, which Schwarzenegger has previously disavowed.