Instead of introducing new programmes, Mr Brown has focused on dealing with the state's long-term debts.
The city already spends 16 cents out of every tax dollar to pay long-term debts, according to Ms. Lowenstein of the Independent Budget Office.
Among the city's financial problems — which include long-term debts of $12 billion — was its annually spending $150 million beyond its means, then borrowing millions more to cover the shortfall, Mr. Bing said.
In truth, the industry business model relies on the fact that most people cannot afford to repay the original loan, which means they end up saddled with long-term debts carrying interest rates of 400 percent or more.
Because Medicare and Medicaid are two of the largest contributors to the country's long-term debts, slower growth in health costs could reduce the pressure for enormous spending cuts or tax increases.
Members of Congress have recently begun looking into whether a new chapter of the federal bankruptcy code, or some other legal framework, could be created to allow states with the most troubled finances to restructure their long-term debts.
