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Getting Beyond Ad Hoc Fiscal Federalism: A Proposal for a Default Federal Liquidity Facility for the States
The Yale Law Journal  (IF5.32),  Pub Date : 2021-11-28, DOI:
Darien Shanske

Our current approach to state debt overcorrects for the problem that states might borrow too much. We can do better and aspects of the federal response to the pandemic illustrate how. The federal government should make forgiveable low-cost loans available to the states, but within limits to prevent moral hazard.