Why is the federal government not paying its bills?

California and two other states have threatened to file suit againt the federal government because of the prescription drug plan and other programs promising federal money. I first heard this story on cnn radio. California is claiming that the new drug plan will cost the state too much money and they cannot depend on the federal government to pay them back. The radio also stated that several states have not been paid promised federal money for homeland security or the detention of illegal immigrants. Also according to the radio Texas and one other state has similar lawsuit plans.



today.reuters.com...:urn:newsml:reuters.com:20060202:MTFH10956_2006-02-02_01- 17-32_N01139962:1

Well, states have their own income that comes from the residents of the state usually on taxes to pay for the services offer in that particular state.

The federal government also give money to the state to ease the burden of paying for services.

But right now these funds has been cut, leaving the states to fend for themselves.

for states that generate a good sizable revenue from their residents they have not problem with shortage of federal funds.

But many other states do not have the same opportunity and are more dependent on federal funding.

I guess since this has been going on for a while more and more the states are coming forward to voice their needs for federal funds and what has not been given to them so far.