Local governments across the country are only now starting to feel the worst effects of the now five-year-old housing crisis. As property assessments finally start to reflect falling home values, local tax revenues will take a hit. However, many experts agree that this is only the beginning for these burgeoning deficits, as home values will continue to decline into 2012 and 2013. Where local governments can make up this difference remains unclear.
Thomas Sugrue, history professor at the University of Pennsylvania and author of "The Origins of the Urban Crisis" studies the economic pressures felt by cities around the country. He discusses why municipalities are only now feeling the pinch. Ed Pawlowski, mayor of Allentown, Pennsylvania, talks about his city's circumstances.