- Governor Schwarzenegger declares the State is in a fiscal crisis and invokes emergency powers to impose $150 million in spending cuts without the Legislature’s approval. The funds will go to cities and counties to make up for the money lost when Schwarzenegger rolled back the vehicle license fee
- The Bush administration’s judicial conduct is repudiated by federal appeals courts on both coasts in twin rulings that assail the military’s contention that it can hold "enemy combatants" without access to lawyers or the courts
- By a 3-2 vote, the California Public Utilities Commission approves a modified bailout plan for Pacific Gas and Electric to emerge from bankruptcy
- A second Wall Street rating agency cut California’s bond rating to near junk-bond status
- Israeli Prime Minister Ariel Sharon warns Palestinians that he’ll impose a unilateral plan separating Israel from Palestinian territory if there’s no speedy implementation of the U.S. Road Map plan
- The head of the U.S. team which has been fruitlessly searching for weapons of mass destruction in Iraq is considering leaving his job within weeks