States preparing for debt ceiling default - Jul. 21, 2011
NEW YORK (CNNMoney) — Just the threat of a federal default is prompting California to get a $5 billion loan to make sure it can pay its obligations.
States around the nation are drawing up contingency plans in the event that federal policymakers don’t resolve the debt ceiling impasse by Aug. 2. They are preparing for chaos in the municipal debt markets and delays in federal payments for Medicaid, education and other services, which could happen if the federal government defaults on its obligations.