Some fear the state [Illinois] is a hair’s breath from (gasp!) bankruptcy. Indeed, Illinois is not taking in cash, its liquid assets have dipped below $1 million at times, Comptroller Dan Hynes said.
“We would like all the stakeholders of Illinois to recognize how close the state is to bankruptcy or insolvency,” Laurence Msall, president of the Civic Federation, a fiscal watchdog in Chicago told Crain’s Chicago Business.
The latest count puts Illinois’ unpaid bills at around $5 billion. Unfunded liabilities and pension debt are projected to reach $95 billion by June 30.
Despite an immediate budget shortfall estimated to be as high as $5.7 billion, state officials haven’t shown the political will to either raise taxes or cut spending sufficiently to close the gap. (Source)
Why, you ask, are State Legislatures dragging their feet? One commentor observed,
We are “governed” by a political class that has made the calculation that letting problems get worse is more in their best interest than working on solutions. (Source: Onthego)
It looks like Illinois will be the first State to default in 2010. Many thought it’d be California.
Illinois’ default will become Obama’s dilemma . . . bailout or bankruptcy. Given that Obama is from Illinois he may have to help his “friends” with a nice fat bailout.
Who could have known?