Schwarzenegger to U.S.: State may need $7-billion loan - Los Angeles Times: "SACRAMENTO -- California Gov. Arnold Schwarzenegger, alarmed by the ongoing national financial crisis, warned Treasury Secretary Henry M. Paulson on Thursday that the state might need an emergency loan of as much as $7 billion from the federal government within weeks The warning comes as California is close to running out of cash to fund day-to-day government operations and is unable to access routine short-term loans that it typically relies on to remain solvent."
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California isn't the only government that can't get a loan. But that state has been spending and regulating itself into insolvency for a long time, and the voters have made it worse by passing initiative measures that crippled the government (property tax cap, term limits, etc.) Add to that a new pattern of population movement--immigration of low income people and out-migration of the middle class to Nevada, Utah, Arizona, Colorado, etc., topped off with socialist mayors running LA and SF, oblivious to economic realities. The last thing the state needed was having their credit card cut up.
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