@layman,
I appreciate your patience.
My original point, which really wasn't particularly significant, was to draw a distinction between the flexibility the federal government has with regard to debt as opposed to states, municipalities and individuals. Congress can choose to cut taxes and hope that revenues increase in a growing economy whether or not that even works.
Quote:This makes no sense:
"The fact that the municipality must declare bankruptcy is precisely my point. It's not as if a structural deficit can simply be ignored."
Okay, let me see if I make it more clear. I said that municipalities cannot operate with a structural deficit. Builder pointed out that they can and do. But we're using the word "can" in slightly different ways.
Say there's a newly-seeded lawn in a park and a big sign that says "Don't Walk on the Grass." Some punk decides to take a shortcut and walks right over the new lawn. A cop yells, "You can't walk there!" and the punk replies, "Well I'm doing it, right?" So yeah, if a poorly run city, or one with a badly drawn up budget ends up with a deficit, year after year, it's "operating with a structural deficit". Like Detroit did. But sooner or later the disparity has to be confronted. Creditors must be paid. The punk gets a summons to appear in court.