Via Les Jones, who got it from Zero Hedge, who found it at Economic Policy Journal, so now this is 4th hand and probably worthless.
Anyway the thinking (?) goes that some 32 states have had to take loans from the federal government to cover their unexpected (!) expenses for unemployment payments, so I guess that recovery O'Bama's been telling us about isn't as robust as he'd like us to think.
Item 1: If you take a loan to cover expenses in a tight period, you are not bankrupt. There are a whole bunch of banker-speak words for that sort of thing, with varying degrees of menace attached.
Item 2: If you blow the payment on the loan, then you are, in fact bankrupt, and need to jump through either the chapter 11 or chapter 7 procedures.
Item 3. Hopefully someone in Washington is taking note of this, and warning the president that if large numbers of states can no longer meet their payrolls, the Gulf Oil Spill is going to be the least of his worries.
Having 4 million union thugs ready at the drop of a hint to give money to your friends, and beat up your enemies is all well and good, but if they find their paychecks bouncing, that loyalty will vanish without even the traditional puff of smoke.