The new Republican controlled House is laying down the law for states as they look to balance their budgets – don’t expect any more federal aid.
Rep. Jason Chaffetz tells Slate.com that he is going to help draw the line.
"I'm going to introduce a resolution when the new Congress begins, stating that the House will not bail out state budgets," says Rep. Jason Chaffetz, R-Utah. "The message is: States, don't think the federal government is going to bail you out. Pay attention to this now."
That shift has pension fund and union advocates worried. Why?
Right-leaning Reuters columnist James Pethokoukis laid it out for them. If the states aren't bailed out, they're going to have to start cutting budgets. If there's total transparency about pension funds—and voters are already in the mood to shave the benefits and numbers of public workers—then that's where you can cut. Republicans might even be able to pass legislation that would allow states to declare bankruptcy, which would move the pension debate from politics to court, zapping all of the unions' leverage. "From the Republican perspective," wrote Pethokoukis, "the fiscal crisis on the state level provides a golden opportunity to defund a key Democratic interest group."