Government Loan-Backed Securities (GLBS) for Long-Term Deficit Financing

This white paper explores the concept of Government Loan-Backed Securities (GLBS) as a mechanism for financing state and federal government deficits through long-term bank loans (30-50 years) that are pooled, securitized, and sold to investors by a syndicate of banks. The structure can be enhanced through Federal Reserve involvement to lower borrowing costs and improve market liquidity. Cost modeling suggests that, with securitization and potential Fed guarantees, GLBS could approach or even match the cost of long-term government bonds while diversifying funding sources.