Gov. Arnold Schwarzenegger is flitting around California these days, warning voters that if they don't enact a $15 billion bond issue to refinance the state's budget deficits, they will feel cataclysmic effects.

State Treasurer Phil Angelides is conducting his own sprint around the state, warning that Californians will face dire consequences if they do pass the bond that Schwarzenegger is touting, because repaying it will divert money from vital services.

Schwarzenegger said during a kickoff rally in Fresno last week that "Armageddon cuts" would be required in state spending if the bond fails, and Angelides quickly countered that "no one should be threatening the voters of this state with chaos or Armageddon."

Obviously, both officeholders -- potential rivals in 2006 -- can't be correct. In fact, both are wrong, or at least are inflating the matter beyond all rationality.

Truth is, the $15 billion bond issue is not a very big deal. It would, for the most part, merely refinance most of the short-term debt that former Gov. Gray Davis and the Legislature amassed during three years of running up irresponsible deficits in the budget. Angelides implies that this is new debt and lays it at Schwarzenegger's door, but it's not -- although by making such an issue of it, Schwarzenegger is assuming ownership. Were the bond to fail, California would simply negotiate with Wall Street lenders to roll over the short-term debt into some new short-term loans -- messy and expensive, perhaps, but doable -- and life would go on.

If there's a real debate here, it's not over the bond, but over taxes. Angelides, echoing other Democrats, wants to boost taxes, especially on high-income Californians, while the GOP governor has pledged to balance the budget without new taxes, which means deeper spending cuts. Even if the Democrats prevailed, however, a bond or some other form of medium-term borrowing still would be needed since new taxes could not cover the accumulated debt in just one year.

Actually, the bond may be too small. It covers the short-term debt owed to private lenders but doesn't cover billions in other loans from the state's own special funds, principally transportation accounts. If the state were to refinance everything, it would be about $25 billion. And a good case could be made for doing exactly that, and levying a special tax to pay for it -- a stupidity tax, in effect -- that would remind all of us just how foolishly the politicians behaved, and how foolish we Californians were to tolerate it.

All of that notwithstanding, the Arnie and Phil Show (with Controller Steve Westly playing a supporting role) is mostly about politics. Schwarzenegger's authority centers on his ability -- presumed but unproven -- to convince voters. Passage of the bond would prove that his public standing is reality, not theory, and thus make the rest of his job much easier.

Legislators who are now befuddled by the Schwarzenegger phenomenon would worry that he would use his standing with voters to do something that they would find onerous -- such as reducing their salaries or imposing a new legislative redistricting plan.

But the flip side also is true. Were voters to reject the bond issue -- which current polls indicate they are inclined to do -- Schwarzenegger's prestige would suffer a serious setback and he would lose clout vis-à-vis Angelides and other Democrats on taxes and other issues. At the same time, however, Schwarzenegger might feel compelled to back up his "Armageddon" predictions by slashing state spending more deeply, hitting the health, welfare and education programs that Democrats favor.

That's why, one suspects, Democrats are all over the map on the issue. Angelides may have chosen the bonds as his defining issue, just as Schwarzenegger has done, but other politicians are wary. Westly, a potential Democratic candidate for governor himself, has joined the governor's bond drive, but he also denounced Schwarzenegger's budget during this month's Democratic state convention and called for his defeat in 2006. The convention itself couldn't agree on a position.

Schwarzenegger, Angelides and Westly may be talking to voters about bonds, but they're really jostling for position two years hence.