New York state lawmakers want tighter regulations and laws governing how hedge funds can buy up sovereign debt — a practice that has been employed in developing countries and economies that opponents have argued can also strangle growth.

Democratic state Sen. Liz Krueger and Democratic Assemblymember Jessica González-Rojas on Tuesday unveiled a measure that would bar the purchasing of securities for the use of litigation. The proposal is meant to end the use of so-called "safe harbor" for transactions that reduce legal liability worth more than $500,000.

At issue is the impact these sovereign debt purchases can have on countries' ability to use their own revenue and resources to provide essential services and grow their economy. As a result, some countries instill austerity measures to cover their debt.

“When we help destroy other countries’ economies, preventing them from providing education, infrastructure, clean water, electricity and healthcare to their people, not only do the people of that country suffer, but we suffer because we’re responsible for allowing this to happen," Krueger said. "We can’t continue to destroy countries, wreaking international havoc, to allow the hedge funds to game our system to build their personal wealth. We need to shut them down."

The measure was introduced as lawmakers are also pushing for a bill that would allow for a pathway for countries to get out of debt. The concern can also affect U.S. territories like Puerto Rico, as the island has also struggled with financial complications from a heavy debt burden.

“As a daughter of the Puerto Rican diaspora, I know well how vulture funds harm the economies of countries and territories like the island of Puerto Rico," González-Rojas said. "The playbook has been the same in Argentina, Peru, and other parts of the world. It is cruel, irresponsible, and it must end now. I’m proud to carry this legislation with Senator Liz Krueger and call on the legislature to support it and report it out of committee and pass it into law. The United States can no longer be allowed to place the foot of imperialism on the necks of other countries as New York stands idly. The International Monetary Fund has said it’s up to us, so let’s get to work and make it happen."