Most localities sell bonds, backed up by promise of future tax revenue. Eventually their bonds are downgraded and they have to pay higher and higher interest ra

Most localities sell bonds, backed up by promise of future tax revenue. Eventually their bonds are downgraded and they have to pay higher and higher interest rates. Finally, the math comes crashing down and the game is over when the market has no more appetite for the bonds and the state and feds won't backstop them.