Arnold Schwarzenegger, Budget Crisis | featured news

California Governor Arnold Schwarzenegger and lawmakers failed on Wednesday night to agree to balance the state's budget by closing a $26.3 billion deficit, but officials said talks would continue.

President Obama, Governor Schwarzenegger and other esteemed politicos may routinely distance themselves from the potential windfall that would accompany legalizing and taxing cannabis, but amid California's latest and deepest financial crisis the state Board of Equalization has tagged a whopping revenue figure to such a notion.

Legislative leaders emerged from late-night budget negotiations Tuesday to announce they were closing in on a final agreement on how to address the state's $26.3-billion deficit.

California's lawmakers failed to agree on a balanced budget by the start of its new fiscal year on Wednesday morning, clearing the way to suspend payments owed to the state's vendors and local agencies, who instead will get "IOU" notes promising payment.