“wouldn’t they simply stop making payments until someone sued them into bankruptcy?”
It would appear the judge is saying, “come back when you can’t make the payments.” BTW, they have plenty of assets to sell. They haven’t because that would delay filing and they’d lose the money to current debts.
Maybe do sell it to the Chinks...swap it for the entire national debt. After that, the place would bankrupt them...win/win!
Cities/states have taxing ability. I'm sure that they don't want to exercise this ability to the extent needed to generate the funds that they need (political suicide) but they do have that option.
They also can sell city parks, community centers, athletic complexes etc. Probably not an action that most elected officials would want to be a part of, but it would be a way out.
And they should sell their assets. But they need a new way to go forward. You still can’t get blood from a stone.