Arnold raises stakes on budget

Gov. Arnold Schwarzenegger is considering an order that would slash the paychecks of hundreds of thousands of state workers to the federal minimum wage until the state budget impasse is resolved. Mike Zapler in the Mercury News.

The workers would be entitled to recover the difference between their salaries and the minimum wage - $6.55 an hour - once the state enacts a budget and appropriates the money, under an executive order that the governor's office has drafted and that he is considering signing next week.

But the delay would help the state through an immediate cash crunch, as well as add pressure to legislators who failed to resolve their differences and pass a budget, as required, by the July 1 start of the fiscal year.