States' Debt looking like Greek Debt

This graphic shows state debt in three categories: bonds, unfunded pension obligations, and additional liability. The interesting part is the“additional liability” category this essentially represents hidden debt beyond the known pension obligation funding problems. The article this graphic comes from “State Debt Woes Grow Too Big to Camouflage,” Discusses just how bad the situation is as compared to the recent problems in Greece. One of the possible causes of the financial crisis in Greece was after the new Prime Minister announced that about two thirds of the countries total debt had been hidden by his predecessor investors did not pull out immediately, but they were no longer willing to continue investing in Greek debt. Although the author shows both support for trusting that the state debt situation is fine and opposition to that view. The fact that California paid last year’s vendors with i.o.u.’s, but still paid the bonds that came due, seems like the kind of move that won’t cause an investor panic, but could likely reduce future investment into state bonds, much like the situation in Greece.