Since everyone else seems to be coming to the Feds with their hands out, the State of California may be jumping on the bandwagon.
LOS ANGELES — California, the nation’s most populous state and the world’s sixth-biggest economy, has warned the Treasury Department that it may need a $7 billion emergency loan from the federal government because it is running out of cash and has not been able to borrow more.
State officials said they hoped that the $700 billion federal bailout of the financial system approved by the House of Representatives on Friday would help open credit markets that have balked at providing the kind of short-term financing California and other states and local governments routinely rely on to keep operating.
New York State received a similar bailout loan in the 70s and it actually resulted in the city turning around its fortunes for a while. This may not be such a simple proposition, however. The linked article notes that California might not be the only state with these issues.
The problem, he said, may grow worse as 15 states besides California, including New York and Connecticut, work to fill several billion dollars in funding gaps that have emerged this fall.
In his letter, first reported by The Los Angeles Times, Mr. Schwarzenegger said, “California and other states may be unable to obtain the necessary level of financing to maintain government operations and may be forced to turn to the federal treasury for short-term financing.”
How often can we go to the well before it runs dry? And how long will the few remaining fiscal conservatives in Congress keep putting up with this before we begin to see filibusters? I’m quickly coming to the conclusion that it doesn’t matter who wins the presidential election or how many seats each party holds in Congress. Our national leaders are going to be facing some hard times across the nation next year, and the occupant of the Oval Office may not be able to count on more than four years in the seat.