The looming debt crisis for states

Long-term debt obligations. Bond interest rates. Pension liabilities. These words may make your eyes glaze over, but it might be time to sit up at attention. State governors from across the country met in Boston last weekend at the National Governors Association meeting, and their fiscal woes were at the top of the agenda.

Bruising budget battles in individual states have gotten most of the headlines, but as WNYC’s Bob Hennelly explains, there’s a deeper problem looming. Lawmakers have relied on borrowing to patch together budget fixes year after year, and the growing hole is starting to worry investors. That could ultimately mean big changes to what states can afford.

In Harrisburg, Pa., City Controller Dan Miller says he would prefer filing for bankruptcy before turning to Act 47. We talk with Miller about struggling cities in Pennyslvania and their plans to avoid a deepening financial crisis.