Should States Be Allowed to Declare Bankruptcy?

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Forty-four states and Washington, D.C. anticipate budget shortfalls of over $125 million by the end of fiscal year 2011, according to the Center on Budget and Policy Priorities. Many state policymakers are blaming their budget crises on public sector employees, citing expensive pension plans. Crushing state debt has caused some federal lawmakers to consider a legislative remedy: allowing states to file for bankruptcy. But will declaring bankruptcy really solve states' pension woes? How will unions react? What other remedies exist for debt-ridden states?

Joining us is Steven Greenhouse, Labor and Workplace Correspondent for our partner The New York Times. Also with us is Governor Ed Rendell, former governor of Pennsylvania.