Grim economic news from the West coast:
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.Apparently California is just one of many states feeling the credit crunch right now but worry not, our fearless leader has sent a letter to Treasury Secretary Paulson asking for some of that sweet federal bailout cash. I've always considered myself somewhat of a novice when it comes to economic matters but recent events have convinced me otherwise: just ask the government for more money, right? Hell, I could have thought of that.
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.
But Gov. Arnold Schwarzenegger, a Republican, said at a news conference on Friday that the state “is not out of the woods yet” and in a few weeks could run out of cash to pay for basic services.