I think I remember ther being court cases where it was ruled that one must produce ID whenever asked to by a police officer, but I don't recall at what level, or whether it varies from state to state.
I do know that the situation described above makes me extremely uncomfortable.
Is the correct response to being asked for identification on a public bus, "Do you have a warrant?"? (The conclusion that what Deb Davis got in trouble for was not being subservient enough rather than running afoul of bona fide security concerns, is supported by the fact that she was not hassled ordetained on the days when she claimed not to have any ID, only on the day when she said she had it but would not produce it.) I hope the state loses badly on this one.
Just like a whole lot of other people, my first reaction to reading thiswas, "What?! This is America, dammit!"