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State Bankruptcy: Surviving A Tenth Amendment Challenge, David E. Solan

Golden Gate University Law Review

During February 2011 the prospect of creating a state-bankruptcy chapter burst into the national conversation. This debate largely centered on the necessity of state bankruptcy as a means of averting state bailouts, and leading commentators emphasized the need to tread gingerly on state prerogatives under the Tenth Amendment. The constitutionality of bankruptcy for states demands closer scrutiny, given that the Supreme Court’s recent Tenth Amendment jurisprudence has evolved toward protecting state sovereignty.

The principles handed down from a pair of cases in the 1930s involving the constitutionality of municipal bankruptcy would likely support upholding a state-bankruptcy chapter that is carefully …