California may seek Treasury financing

California may seek Treasury financing

news.yahoo.com

California Gov. Arnold Schwarzenegger has told U.S. Treasury Secretary Henry Paulson that the most populous U.S. state may need the federal government to buy $7 billion of debt the state is unable to sell due to weak credit markets- and that California may not be alone.

The $7 billion issue of revenue anticipation notes would raise cash to tide California over the near term until it gets expected revenues, but the plan to sell the debt is in peril because the municipal debt market is frozen

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So now the Bailouts might have to spread past wall street to main street. Every state must have a balanced budget and not carry a deficit. But The frozen credit markets are keeping states from selling their bonds so the can raise the necessary revenue they need to pay state employee wages and other state bills they have to pay.

Can states declare bankruptcy? and if they can what happens? I think we are going to find out very soon. According to Gov. Schwarzenegger California is not the only state facing this problem

news.yahoo.com
(visit the link for the full news article)

I have an idea for Governor Arnold!
how about a winfall profit tax on all those a-hole movie stars???