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California Governor Arnold Schwarzenegger refused to apoligise for his statement that American Indian casinos are “ripping off” the state, www.swisspolitics.org reported.

Schwarzenegger first mentioned the “rip off” in his campaign against a November 2 ballot measure, called Proposition 70, which would permit a quick unregulated expansion of Indian casinos in California.

“Read my lips: The Indian gaming tribes behind Proposition 70 are trying to rip off California. I will say it again and again and again,” a defiant Schwarzenegger said in Los Angeles on Friday. “That’s why they are upset. Because the truth hurts.”

Supporters of Proposition 70, which is funded largely by Indian gaming tribes, responded by calling Schwarzenegger’s position racist.

“The governor’s repeated use of racial remarks against Native Americans is wrong and only increases racial tensions in California,” the Yes on 70 campaign said in a written statement. “Schwarzenegger says he can bring Indian tribes to the table, but with his racial remarks he’s just pushing them away.”

A group representing some Indian gaming tribes demanded an apology from Schwarzenegger, saying that they share revenue with non-gaming tribes, donate money to charity and provide local governments with money for road improvements and public services.

Indian casinos have become more numerous in the United States since key court rulings and new laws favourable to the tribes in the 1980s. That expansion has helped some tribes rise from poverty, but it also triggered a backlash.

Schwarzenegger made casino payments to the state an issue in his run for governor last year, saying tribes were not paying their fair share.

Schwarzenegger earlier this year struck a deal with five tribes to guarantee payments by Indians, who have a monopoly on slot machines. Proposition 70 would nullify that deal and set the payments at the corporate rate of 8.84 percent.

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