Mitch McConnell would rather let states declare bankruptcy than receive more federal aid

The House is set to vote on the new $484B bill Thursday.

The National Governors Association on Tuesday sent a letter to congressional leaders, including McConnell, asking for $500 billion in additional aid to account for lost revenue.

“States and local governments need robust support from the federal government as we navigate the response to this pandemic and to help foster the economic recovery that is ahead,” the letter said.

McConnell alleged that local governments would use federal funds to simply bail out pensions, which he pinned as the source of most of their financial trouble. He also said Congress would not “just send a blank check down to states and local governments to spend any way they choose to.”

State governments cannot declare bankruptcy, but radio host Hugh Hewitt asked McConnell in an interview Wednesday if “we need to invent” a bankruptcy code so that states facing financial fallout from the pandemic “can discharge some of these liabilities that were put in place by previous governors.”

“I would certainly be in favor of allowing states to use the bankruptcy route,” McConnell replied.

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