Turbulence in the municipal bond market-- which is a fancy term for the banks, hedge funds, and other financial institutions that lend money to cities-- has already delayed government initiatives across the country. According to the New York Times, the bond crisis has halted projects in Washington DC, Montana, and Alabama.

Philadelphia could easily be next. Nutter's Five-Year Plan calls for spending $120 million in FY09 on capital investments. Most of that money is supposed to be raised through issuing bonds, which may be financially impossible due to market conditions. What's more, the lack of credit could threaten day to day operations because Philadelphia borrows against future tax returns to finance payroll for city employees.