Californians go to the polls on Tuesday to vote on Governor Arnold Schwarzenegger's controversial plans to save the state from financial ruin.
California's massive debts mean it could face a financial crisis in June unless it raises $15bn by then.
Mr Schwarzenegger, who has pledged not to increase taxes, is proposing to raise the money by issuing new bonds.
The so-called Economic Recovery bond would be the largest every undertaken by a state or city authority.
Mr Schwarzenegger's strategy did not have much public support just a few weeks ago, but he may have turned that around after a blitz of appearances across the state.
Financial 'armageddon'
He has also launched a multi-million-dollar advertising campaign in which he has warned voters that the only alternative is an "armageddon" of spending cuts and possible tax increases.
According to a recent poll, the bond plan is now backed by 50% of voters, with 36% still opposed.
The Republican governor has also managed to win the support of some of his Democrat opponents who dominate the state's government.
But others - led by California's Democrat state treasurer Phil Angelides - have denounced the proposal as a reckless step that just passes the burden of debt onto the next generation of Californian taxpayers.
The proceeds of the bond would be used to make a $14bn debt repayment that falls due in June.
Lenders wary
Missing the repayment would force California to roll over its debts, prompting lenders to raise their interest rates, and putting the state under further financial pressure.
Rating agencies have warned that the California's credit rating would fall to junk status if it misses the repayment deadline.
According to some estimates, California would have the fifth biggest economy in the world if it were an independent country.
But the collapse of the technology bubble, high social welfare costs, and entrenched voter resistance to higher taxes, have plunged the state's finances deep into the red.
http://news.bbc.co.uk/1/hi/business/3526385.stm
California's massive debts mean it could face a financial crisis in June unless it raises $15bn by then.
Mr Schwarzenegger, who has pledged not to increase taxes, is proposing to raise the money by issuing new bonds.
The so-called Economic Recovery bond would be the largest every undertaken by a state or city authority.
Mr Schwarzenegger's strategy did not have much public support just a few weeks ago, but he may have turned that around after a blitz of appearances across the state.
Financial 'armageddon'
He has also launched a multi-million-dollar advertising campaign in which he has warned voters that the only alternative is an "armageddon" of spending cuts and possible tax increases.
According to a recent poll, the bond plan is now backed by 50% of voters, with 36% still opposed.
The Republican governor has also managed to win the support of some of his Democrat opponents who dominate the state's government.
But others - led by California's Democrat state treasurer Phil Angelides - have denounced the proposal as a reckless step that just passes the burden of debt onto the next generation of Californian taxpayers.
The proceeds of the bond would be used to make a $14bn debt repayment that falls due in June.
Lenders wary
Missing the repayment would force California to roll over its debts, prompting lenders to raise their interest rates, and putting the state under further financial pressure.
Rating agencies have warned that the California's credit rating would fall to junk status if it misses the repayment deadline.
According to some estimates, California would have the fifth biggest economy in the world if it were an independent country.
But the collapse of the technology bubble, high social welfare costs, and entrenched voter resistance to higher taxes, have plunged the state's finances deep into the red.
http://news.bbc.co.uk/1/hi/business/3526385.stm
