Fix the budget. Compromise. Use your fame.

To: Arnold Schwarzenegger

From: Prominent Californians who know what it takes to lead.

Re: What now?

This, one would assume, is what you wanted. You are now the Governator, the Collectinator, or the Whatever-in-Chief you want to call yourself. Now it's time for business.

Obviously, you've got some ideas. In one day, you repealed the car tax and called for a special session of the Legislature to deal with the budget, workers' compensation, and driver's licenses for illegal immigrants.

This memo is just to make sure you don't veer too far off into some sort of Conan complex. Consider it a Cliff's Notes for a successful administration - the four things that you must do to turn California around, according to some of the best thinkers in the state.

The good news is that, in some important respects, you're off to a good start. From bipartisanship to the deficit, you've talked about the right things and set the right tone. The bad news is that, from here on out, you can't use swords or chokeholds if things go wrong.

No. 1: Balance the budget.

If there is one good thing about this budget mess for you, it is this: There is no ambiguity about what you're in Sacramento to do. Car taxes and driver's licenses are nice, but you were elected to solve the budget crisis. If the state is billions of dollars over budget when your term is up, Californians will give you the worst review of your life - and a one-way ticket back to Hollywood.

"The most important responsibility is to present a credible budget," says Leon Panetta, White House chief of staff for President Clinton and current director of the Panetta Institute for Public Policy in Monterey, Calif. "[It must be] one that honestly addresses the issue of cutting spending and raising revenues."

It's true that an improving economy might help, but your own finance chief says that even with modest growth, if spending habits don't change, California could be running $62 billion deficits by 2006. Unless you're planning on making 120 more Terminator films and donating the box-office receipts to the state, that means change.

Since the inauguration, it's clear what the plan is: Borrow as much as $20 billion to defer current debt and implement a spending cap to bring revenues and expenditures into balance. The cap is, at least, an attempt at a long-term solution to the state's chronic overspending. But the plan is also the clear path of political expedience.

Take your own advice. Bipartisanship isn't just listening to other people; it's working out a compromise. Maybe that means a tax increase to help pay for the deficit. Maybe it doesn't. But it means keeping all options on the table. And who knows? You might fix more than the budget along the way.

No. 2: Mend Sacramento.

In many ways, deficits are inseparable from partisanship and the gridlock it's created. In the political kindergarten of term limits here, both parties probably should have been sent to sit in the corner long before Gray Davis arrived. It only got worse as the governor often turned his back to the class.

You were the Kindergarten Cop. This should be easy. Play with them. For five years, they've felt neglected and maligned. Involve them. Invite them over to dinner. Give them copies of "Pumping Iron."

"Use fame and celebrity to charm the legislators, who would be susceptible to dinners, movie stories, all that stuff," says Bill Boyarsky, author of two books about Ronald Reagan's pre-presidential political career. "Reagan ... had [legislators] over to his house, met with them and charmed them.... He was very accessible, and they all liked him."

There will be major policy issues to hammer out and compromises to be made, but "politics is all relationships," says Mr. Boyarsky. "[Governor] Davis didn't build relationships."

No. 3: Have a vision.

When stories of stomach crunches with former President George Bush leave legislators cold, unite them under a common California. Ronald Reagan did it. So did Pat Brown. And Earl Warren. And Hiram Johnson. These are men whose stern oil paintings still look over the Capitol as if they were running the place. When their names are uttered, you want to be in the same breath. They are our Founding Fathers, our Trusted Stewards. "The Party of California is a great big tent that includes Republicans and Democrats," says Kevin Starr, California's state librarian. "One reason these people got so much done was their alliances."

Tell us where you're taking California. Is it to rebuild the roads ? Fine. To improve access to universities? Fine. But think big. And let voters take part.

No. 4: Bring back jobs.

From early rumblings of the postwar boom to the binge of the Internet economy, California has always been linked to endless opportunity. Things may not be as bad as you made them out to be on the trail, but you're on to something.

Reforming California's workers' compensation - widely viewed as the least efficient program in the nation - is key. Regulations passed to slow growth during the boom now make it harder for new ventures. Today's California is a creation of the state's historic business success, and will be in the future.

"We are really threatened," says John Hennessy, president of Stanford University. "California has flourished in the past ... because we have been able to create a large number of high-paying jobs... California needs to restore some of its attractiveness as a place for jobs."

Much of this you've said before. But unlike many of your predecessors, you have a historic public mandate. "Opportunity" could be the watchword of your administration. Don't let it pass in bickering and blame.

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