Arnie decided to go at the behest of BFF Willie Brown, despite the fact a labor-sponsored event in SF isn't exactly a locale for Team Arnie. Why? Nothing like speaking in front of hostile audiences to appear like your doing some fence mending. And it also it's in keeping with his recent political jump to the left.
Unfortunately for the Governor, once San Francisco Labor Council head Tim Paulson heard that the Governor was going to speak, was all "well I'm not going if he's going" and then all his labor buddies heard that Paulson wasn't going and they were all "well, if he's not going, we're not going" and then they went into a stall at 111 Minna and wrote "Arnie's a Douche" in a stall with a felt-tip marker.
Anyhoo, after some negotiating in which Paulson was given the rite to speak after the Guv, Paulson and his labor buddies decided not to walk out on Arnie's speech. Which they didn't. The only person who did walk out, actually, was Fightin' Chis Daly, although we heard it was only so he could get ready to watch the second part of the "24" season premiere.