Arnold Schwarzenegger announces he's running for governor -- on the "Tonight Show." From his wheelchair, Larry Flynt says he'll be the next governor because Californians are progressive enough to elect a pornographer. Angelyne, Hollywood's self-made billboard celebrity, has taken out papers.

The New York Times, Newsweek and National Public Radio have all called this state and its inhabitants crazy in recent weeks. ABC anchor Peter Jennings routinely refers to "the craziness in California," and CNN stories carry the graphic, "California's Crazy Recall." Californians, after many generations of practice, are usually inured to insults from the jealous throngs who don't get to live here. But the recall-sparked crescendo of craziness has landed with unsettling force because so many of California's own residents have been throwing around the C-word.

Even the state's most loyal protectors -- well-practiced at reminding critics that California has the world's fifth-largest economy, as well as its most advanced multicultural society -- seem shaken.

"I have defended California in season and out, but I'm throwing in the towel this time," says Kevin Starr, the state librarian and author of several California history books.

"We sort of deserve it this time, don't we? You've got a leading candidate deciding or not deciding on Leno. This is a society melting down into deliberate self-parody."

Californians like Starr say the labeling of the state as crazy would be funny, if the instability wasn't taking such a toll. The price of California's bonds is way down, making it more expensive for the state and local governments to borrow money to cover deficits or build schools and roads. August commentators say the recall could make it easier for national Republicans to marginalize California.

"Yes, it's usually good to be talked about, even for the bad," says Hollywood nightclub owner Gene La Pietra, who is such a devotee of the just-spell-my-name-right school of publicity that he told a reporter Wednesday: "If I don't give you a good, juicy quote, you have my permission to make one up."

But La Pietra, who led a quixotic effort to get Hollywood declared its own city, says: "When the bankers on Wall Street are talking about lowering our bonds, when investors are talking about sitting out California, it's time to worry."

Few Californians admit to being any zanier than anyone else. Author D.J. Waldie calls the perception of the state's madness "a tired cliche that hangs over California like June gloom, impossible to dispel because it is ingrained in the American culture."

Political analysts point out that California has elected moderates to statewide office. And "there are a large percentage of voters discontented with Gray Davis, and they are going to see about an alternative," says Michael Barone, coauthor of the "Almanac of American Politics." "That's not insane."

On streets across the Golden State, many agree.

Strolling down Montana Avenue in Santa Monica, Dana Stevens of Brentwood points out that Minnesota elected former professional wrestler Jesse Ventura governor.

At Universal City Walk, Yvonne Renard, an El Cajon native who now lives in Louisiana, says her fellow church members in Shreveport "think Californians are crazy because of the freedom out here. Free loving, free living, free doing."

Immigrants and foreign visitors sometimes point out that compared to most of the world's governments, California politics are remarkably stable.

"An elected politician unable to complete his term is not something that we find so unusual," says Francesco Sciortino, the consul general for Italy in San Francisco.

"Italians feel perhaps closer to Californians than to people in other states. We like the California way -- we find it not so far from our own."

Even while arguing that they aren't crazy, some Californians secretly embrace the label. The idiosyncrasies of the state and its people set it apart, providing it a distinction and an identity.

Besides, craziness sells.

Gary Mittin, an online entrepreneur, has already sold 200 "Arnold 4 Governor" T-shirts on his Web site, and has developed an "I like Dick" logo for Riordan backers.