Schwarzenegger Ready to Work With Bush

Gov.-elect Arnold Schwarzenegger (search) is arriving in Sacramento with hopes of getting along better with one of California's biggest enemies: the Bush administration.

California has staged epic battles with the federal government on issues including the environment, energy, health care, immigration and medical marijuana.

During his first news conference as governor-elect, Schwarzenegger indicated he is willing to reach some compromises with President Bush, who plans to campaign with the governor-elect in California next week.

Schwarzenegger also plans to ask Bush for some favors in return, especially when it comes to getting more out of California's tax dollars.

"He promised me he would do everything possible to help California, and so I'm looking forward to working with him and asking him for a lot, a lot of favors," Schwarzenegger said.

"They say that for every dollar we pay in tax, we get only 77 cents back. So there's a lot of money we can get from the federal government and also a lot of other help."

For his part, Bush said he's "absolutely" ready to work with the new governor. That is a striking turnaround from the polarized relationship between Bush and ousted Gov. Gray Davis (search), who mostly failed in his attempts to get the federal government to reimburse California for everything from the costs of imprisoning illegal immigrants to increased homeland security.

The battles reflect a desire among California's Democratic leaders for the state to have its own standards, which in many cases are more environmentally friendly, socially liberal and protective of consumers.

"A hallmark of our state has been its willingness to say to the Bush administration, 'What you're doing is bad for our state, and we're going to take a different direction,'" said Carl Zichella, regional staff director for Sierra Club (search) in Sacramento. "But I'm not sure how a Republican governor can tell Republican presidential candidate who is fighting for his life that he can't have what he wants in California."

The point-man for the legal battles has been state Attorney General Bill Lockyer (search), who on Thursday sent Schwarzenegger a confidential memo outlining all the state's litigation, including dozens of lawsuits against the federal government.

"My view is that the Bush administration is the most aggressively big government of any administration in national history, and so we have those lawsuits just because they're rewriting the doctrine of federalism," said Lockyer, a Democrat who considers Schwarzenegger to be a friend.

While most of the lawsuits are over policies, there's real money at stake as well. Still pending is the state's demand that the Federal Energy Regulatory Commission (search) order energy companies to refund $9 billion in windfall profits made in California.

Schwarzenegger, who was criticized during the campaign for joining a closed-door meeting in Beverly Hills with Enron Chairman Kenneth Lay (search) during the energy crisis, has not said whether he will keep fighting to get the $9 billion refunded to ratepayers.

Consumer and environmental advocates are worried Schwarzenegger will declare surrender.

"I just hope that we'll be able to hold the line, and continue to be the bellwether that we have been in the past on so many issues," said Betsy Imholz, director of the West Coast Regional Office of Consumers Union (search).

Although he hasn't made detailed policy statements on many issues, Schwarzenegger has promised to continue some of California's legal battles — an ongoing lawsuit, for example, that would allow the state to set tougher anti-smog standards for carbon dioxide emissions than the federal government requires.

"California's landmark legislation to cut greenhouse gases is now law, and I will work to implement it and to win the expected challenges in court along the way," he said.

One of the touchiest battles may involve medical marijuana. Schwarzenegger has admitted using marijuana and other "soft" drugs in the past, and was asked while campaigning if he supports drug legalization. Schwarzenegger called it "a bad idea" but said "I would legalize medical (marijuana)."

Smoking marijuana is a federal crime, but in California voters approved a law in 1996 allowing sick and dying people to use the drug. Since then, the Drug Enforcement Agency has raided growers and distributors of medical marijuana, despite protests from local law enforcement.

"The governor can't control the feds, but he has a bully pulpit and can raise his voice," said Bruce Mirken, spokesman for the Marijuana Policy Project (search) in Washington D.C. "Perhaps a Republican like Schwarzenegger can have some influence with the White House."