Wow. There are so many issues.

By the 1970's, cities were aging badly, with the three C's pulling them down (Crime, Costs and Cancer), so they were abandoned for the low-tax suburbs.

New schools and new teachers (at low salaries) in the inner suburbs are now evolving into older schools with higher operating costs, and older teachers (at peak salaries) shifting to retirement, so the old city costs of old retirees and new hires is catching up to the inner suburbs, and looming for many of those newer suburbs.

Behind that is the loss of interest income. A billion in pension funds can earn $100 million at ten percent, and $15 million at one and one-half percent. Albeit many pension funds were under-secured---a matter being addressed through GASB accounting standards beginning in the mid, late 2000s, the interest collapse came before the ship could be righted, and pulled the floor out from under states and localities at the same time they were accruing real losses due to the stupid investment vehicles they were advised into.

While it is entertaining to hear the same old "governments are stupid" argument, the fact is that, absent the interest collapse, economic decline, housing bubble burst, and bad investments, all cascading on states and localities in a few short years, none of these problems and criticisms would exist.

Instead, they are facing fundamental new conditions never contemplated by US federal and financial gurus, and are struggling to stay upright without federal assistance (unlike last year where the Stim money was a bridge).

Let's see---unfunded deficits this year are about the same as last year's stimulus flow. If there is no other funding source, and no longer an expectation of temporariness to the circumstances, then, there is a potential crisis that has not yet been thought through.

State and local layoffs and halted purchasing may, by next year, start to thunder into the national economy, and drive even more national deficits.

Questions and answered which have been avoided, so far, are structural.

What if Las Vegas is permanently overbuilt, overpopulated by 25%? Where do those folks go? What becomes of property values, teacher pension obligations, etc...?

By contrast, a return to boom times would completely eliminate all of this.