Following Nick's great post, I thought I'd describe my seminar, which I co-teach with Dick Ravitch, on the law of state and local budgets. If anyone's interested, I'm happy to send along my syllabus.
Constitutional law, procedure, and many other courses spend weeks and months focusing on federalism. Students learn a great deal about theories of federalism – laboratories of democracy, voting with your feet, and all of that – and about how the Constitution allocates authority. For the most part, though, these discussions focus on what some scholars call “regulatory federalism,” or the relative powers of the federal government and states to pass laws that govern individual behavior. But there is another side to federalism, one less concerned with regulations and more concerned with cold hard cash. Law school classes generally do not spend much time on “fiscal federalism,” how the budgets, taxing power, and spending decisions of the federal, state and local governments interact (the “sides” of federalism are clearly related to one another in all sorts of ways, of course). Just as regulatory federalism presents many complex and unsettled legal, policy and theoretical questions, so too does fiscal federalism.
How we resolve questions about which level of government pays for what has dramatic effects on our lives. State and local govenrments directly provide most of the services we rely on a daily basis, from santation to firefighting. State and local governments also fund a large majority of the country’s investment in infrastructure and human capital, roads, bridges, and schools. They employ around 16M Americans, far more than the federal government. State and local governments either directly or jointly fund large swathes of our social welfare system, most notably Medicaid. What goes in state and local budgets is a very, very big deal.
Today, state and local budgets are largely healthy, after reciving huge amounts of aid from the federal government as part of its response to the COVID-19 crisis. But during the crisis, states and local budgets were sufficiently stretched that they were forced to lay off or furlough more than 1M workers. After 2008, states and cities laid off nearly 800K workers, substantially lengthening and deepening what came to be known as the Great Recession. We also saw major political subdivisions like the city of Detroit and the Commonwealth of Puerto Rico facing such severe fiscal trouble that they needed to file for bankrptucy (or something very much like it).
This is a course about two key issues in fiscal federalism: how states and cities develop budgets and what happens if they get into trouble. This course will discuss key issues in the laws governing state and local budgets -- from the influence of balanced budget requirements and debt limits to state constitutional provisions governing public pensions. It will also discuss what happens in crises, including a deep dive into the federal government’s response to state and local fiscal pressure during the COVID crisis, and how municipal bankruptcy work
We – Ravitch and Schleicher – bring to this class two different perspectives. Chicago Bulls forward Stacey King once bragged that he and Michael Jordan combined for 70 points in a game (Jordan scored 69). Together, Ravitch and Schleicher have more than 40 years of on-the-ground experience advising states and cities about how to address their budget problems. Ravitch has more than 40 years of experience dealing with state and local budget crises, serving as an advisor to the Governor during New York City’s fiscal crisis, Chair of New York's Urban Development Corporation and Metropolitan Transit Authority, Lieutenant Governor of New York, a member of the Oversight Board for Puerto Rico, a consultant to the City of Detroit during its bankruptcy, co-chair of the State Budget Crisis Task Force and in a whole host of other positions in public and private life. Schleicher is a law professor.