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Federalism

Federalism. Fiscal Federalism. Fiscal Federalism Vocabulary. Fiscal Federalism refers to the pattern of spending, taxing and providing grants in the federal system. In 2010, state and local governments are set to receive $480 billion in federal grants. Categorical grants - specific purpose

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Federalism

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  1. Federalism Fiscal Federalism

  2. Fiscal Federalism Vocabulary • Fiscal Federalism refers to the pattern of spending, taxing and providing grants in the federal system. In 2010, state and local governments are set to receive $480 billion in federal grants. • Categorical grants - specific purpose • Interstate highways • Wastewater treatment plants • Block grants - fewer strings attached • States spend as they see fit • Education, community development, and homeland security. • Nixon and Reagan (GOP) uses these.

  3. Fiscal Federalism Vocabcon’t • Mandates – a rule telling states what they must do to comply with federal guidelines. • Most common – civil rights and environmental • For example – civil rights mandates forces states not to discriminate against people because of race, sex, age, or ethnicity • Unfunded mandates – requires the state to meet guidelines but provides no resources for these services. • Handicapped Children’s Protection Act (1986) – required public schools to build ramps and provide special busses but did not give states any money to provide these services.

  4. Party Positions on fiscal policy

  5. More fed control of $ • 1992 – Clinton elected to Presidency with control of both houses of Congress • 1994 Republican plan to gain control of Congress • Contract with America prohibits unfunded mandates – Newt Gingrich • tax cuts • welfare reform • smaller federal government • Welfare Reform Act 1996-Clinton • shift from fed entitlements to block grants. • Recipients must look for work • Mandated states find dead beat dads who did not pay child support

  6. Fiscal Federalism con’t • Devolution revolution – refers to a movement to transfer responsibilities of governing from the federal government back to the state and local government. This was Reagan’s New Federalism – giving power back to the states. • Welfare Reform Act (1996) – gave the states money to run their own welfare programs. States had wide discretion of how to transfer people from welfare to work.

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