Should states file for bankruptcy if they have pension plan difficulties?
FOX Business contributor Ed Rollins says while most states are required to balance their budgets every year, the federal government might have to assist them once coronavirus is over.
U.S. Senate Majority Leader Mitch McConnell on Wednesday opened the door to allowing U.S. states to file for bankruptcy to deal with economic losses stemming from the coronavirus outbreak that are punching big holes in their budgets.
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McConnell said in a radio interview that Republicans would not support giving state and local governments more money in future coronavirus aid legislation, saying those funds could end up being used to bail out state pensions.
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Speaking on Hugh Hewitt's syndicated conservative talk radio show, McConnell said he instead "would certainly be in favor of allowing states to use the bankruptcy route."
Democratic governors slammed the idea.
"Almost hoping for bankruptcy of American states amid the biggest healthcare crisis this country has faced is utterly irresponsible," New Jersey Governor Phil Murphy said at a press conference.
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A spokeswoman for Illinois Governor J.B. Pritzker said "every state is facing budget shortfalls and we need partners in Congress who will work with us on real solutions, instead of using this crisis to propose an ideological Hail Mary."