Gov. Arnold Schwarzenegger delivered a long-threatened veto of a Democratic plan to cut $18.1 billion from California’s two-year $41.6 billion budget deficit.

After three weeks of negotiations, Schwarzenegger and Democratic lawmakers failed to reach a compromise that would convince him to sign the plan, which would partially close the growing budget gap through $9.3 billion of revenue increases, $7.3 billion of spending cuts, and $1.5 billion of interfund transfers.

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