Illinois and the state of local government debt

http://www.washingtonpost.com/wp-dyn/content/article/2011/01/12/AR2011011206436.html

I think that Illinois' dramatic tax increase (which is larger than I have ever seen a state do) is evidence that state and local governments that face insolvency have the willingness and the means necessary to address their problems. Among major state and municipal governments, I really haven't found any that have so overexerted themselves to the point that they cannot reasonably increase their tax burdens or decrease spending by enough to make up the gap. As such, Meredith Whitney's assertion that there will be between 50 and 100 major municipal defaults is a little questionable.