The Foundry: What do the Bridge to Nowhere, the highway bill, the “subsidies for millionaires” farm bill and our crippling entitlement crisis have in common? They are all examples of the corrupt governance that is guaranteed to happen when the federal government takes over responsibilities best left to the states. In each of these cases (transportation funding, agriculture policy and health care), massive federal government spending and aid to states in the form of matching grants have all but drowned out the ability of state and local governments to set their own priorities without approval from Washington.Federal aid to states has been practiced for more than 100 years, but two distinct periods witnessed an explosion in the practice. In 1960, the federal government sent $48 billion to states. By the time President Lyndon B. Johnson’s Great Society had been implemented, that number nearly tripled to $129 billion. . . . federal spending on aid to states has again exploded from $286 billion in 2000 to $449 billion in 2007. . . . Every year about $500 billion flows into Washington from the states, is divvied up by lobbyists and congressional power brokers, and is then returned to states. It is an extremely inefficient funding system that serves no economic or civic purpose . . . [Read More]
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