At the state and local level, fiscal sustainability is the capability of a government to meet consistently its financial responsibilities. In the short run, this involves either reducing expectations of government’s roles or tinkering with the tax system to raise additional revenues. In the long run, it means that financial decisions must be made to protect future generations’ fiscal abilities. There is clearly a connection between shortrun
decision-making and long run outcomes; this white paper will therefore discuss both although it will ignore nuances and second-order problems.

This article is supporting documentation for the Alliance for Innovation Navigating the Fiscal Crisis white paper.