When the clueless New York Times, fishwrapper of record, notices something, you can rest assured that, after you extract the political spin, they are merely restating the obvious, and so it is today:
Policy makers are working behind the scenes to come up with a way to let states declare bankruptcy and get out from under crushing debts, including the pensions they have promised to retired public workers.
Unlike cities, the states are barred from seeking protection in federal bankruptcy court. Any effort to change that status would have to clear high constitutional hurdles because the states are considered sovereign.
But proponents say some states are so burdened that the only feasible way out may be bankruptcy, giving Illinois, for example, the opportunity to do what General Motors did with the federal government’s aid.
Beyond their short-term budget gaps, some states have deep structural problems, like insolvent pension funds, that are diverting money from essential public services like education and health care. Some members of Congress fear that it is just a matter of time before a state seeks a bailout, say bankruptcy lawyers who have been consulted by Congressional aides.
I have been raising the issue of state bankruptcy on this blog for years, go here and here to read two of my posts on the subject, and that process will be starting soon, probably in the aftermath of a state being unable to make payroll to state employees. When it does happen, I guarantee that the Land of Lincoln will be first in line. State governments have sown the wind with ludicrous spending for decades in many states and the whirlwind is rapidly forming.