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Study says US may need new tack for 'grim' cities

The nation's cities are in "grim" fiscal trouble and the federal government may have to develop new policies to deal with municipal defaults, a congressional study said.

"The number and proportion of cities which reported deficits in this report surpassed even the most pessimistic projections," said the survey by the Joint Economic Committee, warning that continuation of the cities' crises "could well create another round of urban emigration.

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"In 1980, over 70 percent of the largest cities were in deficit and for 1981, all but four of the largest cities anticipate running deficits."

The survey noted that both city and state governments will be forced to live with less federal assistance, but warned that "drastic and sudden reductions in assistance . . . will exa cerbate the already serious fiscal problems . . ."

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