As recent events illustrate, state finances are pro-cyclical: during recessions, state revenues crash, worsening the effects of economic downturns. This problem is well-known, yet persistent. We argue here that, in light of predictable federalism and political economy dynamics, states will be unable to change this situation on their own. Additionally, we note that many possible federal remedies...

Problem solving in the tax domain requires two kinds of knowledge: of the law itself and of how the law has been applied in the past. The need for the second factor arises as a result of the ambiguity of natural language. The problem solver requires information on how the courts have adjudicated specific cases in the past. This information would then provide the basis for reasoning about the cu...