The governor wants to suspend Proposition 98, the law which guarantees funding levels for kindergarten through 12th grade and community colleges.
The move would allow the state to make deep cuts in education spending, and reduce the state's $26 billion deficit. The idea is opposed by teachers unions, who have sharply criticized the governor in TV ads.
The governor is now fighting back with an ad of his own.
"Californians are losing their jobs, their homes, and they're worried about their children's future," said Gov. Schwarzenegger in a political ad.
In the ad, the governor says he won't sign a budget that includes tax hikes or doesn't eliminate waste. The ad begins airing statewide today.