Welcome to Axis ProRata, where we take just 10 minutes to get you smarter on the collision of tech, business, and politics.

I'm Dan for Mac. On today's show, cannabis in the age of coronavirus and smartphone makers feel the pain.

But first, states going bankrupt. So it's becoming clearer and clearer that states are facing their most

severe fiscal crisis since the Great Depression, with plummeting tax revenue and soaring

obligations. What's unclear, though, is what the federal government plans to do about it.

Now, there was about $150 billion in state and local aid in the original CARES Act,

but most feel that's not nearly enough to cover what could be major budget shortfalls in many states, led by governors of both parties. But there is a partisan

divide over whether or not more federal aid is appropriate. In short, Democrats want it. Republicans

are less sure. Here's Mitch McConnell speaking last week on Hugh Hewitt's radio program.

I would certainly be in favor of allowing states to use the bankruptcy route. It's to save some

cities and there's no good reason for it not to be available. So three things to know. First,

states cannot go bankrupt under current law. Cities and towns and counties all can, but states cannot.

McConnell seems to want it to be able to happen, but has not yet introduced any legislation

to change it.

Two, bankruptcy isn't the same thing as going broke.

Bankruptcy is about not being able to pay off your debt obligations and then letting a court

sorted out.

Going broke is about having more bills than money, which is really the situation that most

states find themselves in, and debt payments are just a tiny piece of that.

Three, the politicization of this is maddening.

President Trump suggested that only blue states are asking for more federal aid, but that's

simply untrue.

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