First, today, the Sacramento Bee‘s “Capitol Alert” reported:

[Elizabeth] Hill’s selective cuts are “an unfair way to go,” Schwarzenegger said in a speech to Town Hall Los Angeles while urging lawmakers to move quickly on more spending cuts to speed up their fiscal impact.

“If we have $96 billion that’s all we have,” Schwarzenegger said, contending that continuing to spend more than the revenue system can produce is “setting yourself up for failure.”

Schwarzenegger says he opposes any broad new taxes to close the budget gap while Democratic legislative leaders say they want to balance spending cuts with new revenues.

A little while later there was more detail, including an ambiguous statement from the Governor that he later backed down from:

“She has identified $2.5 billion of tax loopholes, including the yacht tax,” Schwarzenegger said at a Los Angeles economic town hall, using an estimate of Hill’s $2.7 billion figure. “I think that we should go after those tax loopholes because we would need the extra $2.5 billion. This is $2.5 billion we can give straight to education. I’m totally for that … and I agree that we should go for it and we should do it because everybody has to give something in order to make this work.”

But speaking to reporters after his appearance, Schwarzenegger backtracked. “I’m not for the recommendations she made, necessarily,” he said, according to a transcript of his remarks.

“I think the key thing that we have to also do at the same time is, as I said in there, to take Liz Hill’s recommendation and to look at – have Democrats and Republicans come together – and look at all the ideas that are available and where we can, you know, close some of those tax loopholes,” he said. “Because I’m sure there is tax loopholes out there that we can close that will give us additional money for our budget so we don’t have to make just cuts, that we can look at those revenues, and I think that’s the important thing.”