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Arnold Unplugged, from the vaults: See you at the pah-ty, or, Drop the chalupa, or, Buy land: they ain't makin' any more of it

September 21, 2007 | 11:59 am

If you haven't taken a gander at our Primary Source from Gov. Schwarzenegger's visit, hop on over and check it out. And if that doesn't fill you up, here's some additional schwarzenschmoozing, in which the governor provides his views on budget discipline, real estate and my weight problem...

Tim Cavanaugh: You just mentioned a lot of Democratic names, and I'm wondering, how far do you think you can continue to push your own party with comments like "Dying at the box office" and things like that. I mean, is there a little bit of buck-stops-here-ism, given that it was your own party that was holding up the budget?

Gov. Arnold Schwarzenegger: If it is, if I am the leader of the party, then I take credit for it or I take the blame for it. But that's not the way it works in California. That's the way it works in Great Britain, that's the way it works in Germany and Austria, that's the way it works in other states. You know, if you talk to, you know, Crist, he would say you know, I did this, through the party, then I came in, changed things around, put my guy in, and now they are the party that is in a sense, me, and in a sense my philosophy. Well that's not the way it works in California. Maybe that's the way we should do it, but I mean that's not the way it works.

So what I do is, I do that, if I see you, um, you know, gaining weight, and gaining weight and gaining weight and gaining weight, I will eventually say — if I care at all about you — I would say, You know something? If you continue this way, you may get into serious trouble, and you'll maybe get a heart attack, or maybe, you know, have problems with diabetes and stuff like that and you can't move around as quickly and you will get tired, and, blah blah all those things. But, here's what I'd do if I were you: I would go and exercise every day, stop eating at night, eat only two meals, be disciplined, and blah blah and all those kinds of things, I would give you a plan. I'd say either you can follow that plan or not. So it's not really that I'm criticizing you, it's just that, look, I care about you, and I want you to live and feel good, as good as I do. And do as well as I do.

So that's what I basically did with the Republican Party, is to go to them and say, Look: Here's the, the swing voters, here's the independents, here's the majority of Republican voters, that actually love the health care proposal, that a majority of them voted for, and any of the polls show that they like what we're doing, they like the idea of taking care of the environment and fighting global warming. They like that I signed AB 32. I say, there's an endless amount of situations where the voters, the Republican voters, are with me. But not the politicians and not the party guys. So what I'm saying is, You should start looking at that. So if you want to become the majority party, look at those things, and look at those independents, and you will see: If you will be inclusive, and if you start changing some of the policies, and direct, you know, do things more for California than just for this one group, I think that we could be again the majority party, and that's where the action is.

Keep reading for more from the ed board, and the governor's real estate tips for smart shoppers...

Lisa Richardson: Excuse me, Governor, could you be a little more specific about some of those consequences that are on the table, that you're discussing?

Arnold: Consequences?

Lisa: For the budget?

Adam Mendelsohn: In terms of, in terms of what we may do in terms of budget reform?

Lisa: Mm-hmm

Robert Greene: If the deadline goes by...

Arnold: Um, some of the consequences... We have to, that's on the table. You know, we have to start getting into that and talking about it. What the consequences would be. You know, maybe, one of the consequences that people have talked about is to deduct the last year's budget, that automatically rolls, but these are just ideas. But there should be certain consequences that happen, if you don't pass the budget.

Adam: And we're just starting, I mean we're not in a position where we can say, This is what we're looking at. I mean this is what we've talked to leaders about as something that next year may be an agenda item.

Arnold: What we can say is that it is unacceptable the way it is now.

Tim: Can I, on an unrelated topic...

Jon Healey: Well before we get off, one of the things...

Arnold: Yeah, who are you to say something?

All: Ha ha ha.

Jon: Right now the only real point of leverage that your party has in Sacramento is the budget. That's how they are able to turn, um 37% or 40% of the seats into some power. So, yeah, I know you're talking about the long term and wanting to be the majority again, but when you're in the minority, do you really want to give away your points of leverage?

Arnold: You know, it will probably be difficult for them to do. But there are ways for us to come together and figure out a way where we can fix the system, and where they may be comfortable with it.

Tim: I noticed you pointed at me when you mentioned affordable housing, and I... the, the real estate situation in California is reaching such a crisis that fairly soon a guy like me might be able to afford to buy a house, so do you see any role for statewide intervention to prevent that from ever happening?

Arnold: I think that the market will take care of a lot of this. I think that we just overbuilt, I think that now by changing, that lowering the interest rate is very helpful. And I think that they've learned from their past mistakes. As a matter of fact when you read Alan Greenspan's, you know...

Tim: The "froth"...

Arnold: Yeah, that some mistakes were made in the past with the real estate bubble and the dot-com bubble and all this stuff... I think to lower the interest rate is the key thing right now, to put confidence back into people to be able to refinance their home, and not having to walk away from their homes.

Tim: You're also, you own quite a bit of real estate in the state. Do you think that prices need to fall...

Arnold: Well, uh, whatever I own in real estate, it's a blind trust and so I'm not involved.

Tim: But I mean you have some experience in — I didn't, I didn't mean it that way, I meant you have some experience.

Arnold: I know I know, but look. Since I've come to California, I've invested in real estate, and I have learned a long time ago: Never make yourself vulnerable, that you have to walk away from a project or a property because the real estate market goes down. When the strength is is to stick it out, because in the end you know. Because houses in Venice where I used to train, where Gold's Gym was, were $21,000. The same house today is $600,000, $700,000, that's the bottom line. Now in the middle, it went like this [vertically zigzags index finger], where people walked away and ran the other away, you know: My God, I'm stuck with this mortgage, and all this. But the reality is, it always goes up. It has to every single property I've ever bought, I've never seen anything go down. Except from one day to the next somebody says: You can't build on this property. You have 30 acres in downtown and you cannot build on this property. Yeah, then you lose money. But uh, even in, even in the Antelope Valley, where I bought land in 1970, with the assumption that it would be a supersonic airport...

All: Ha ha ha ha.

Jim Newton: Can't win em all.

Arnold: ...The only $5,000 I had and where is it out there? But you know something? That $5,000 property today is worth $480,000. So even when everything goes south, and they said there will be no supersonic airport, nothing, you will see no development here in the next 30 years, it still, you end up with that much. So I think the key thing is for people, and there's always a lesson. The same lesson is, Don't stretch yourself. Don't get sucked into this financial institutions like: We can give you the world, we can give you the money, and you don't have to pay anything for it and all those kind of things. Think about it.

* Explanation of title and alternates, respectively, here, here and here.

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