That’s the title of a column in the December issue of Governing authored by Donald Kettl, the dean of the School of Public Policy at the University of Maryland. According to Kettl, the federal government’s new “stinginess” is being directed toward state and local governments. Stinginess? Didn’t he hear about Obama’s $800 billion state bail-out/stimulus bill?
The following are some selected statements from Kettl that left me dumbfounded:
There was a time, of course, when state and local governments were big players in the interest-group scramble. But it was quite a while ago.
To find an administration that was truly sympathetic to state and local pleas for cash, you have to go back to the Nixon era. In the early 1970s, state and local governments benefited financially from the sense that the federal government needed to keep them on course. Urban renewal and community development grants, along with a vast array of programs ranging from Medicaid to education, flowed down from Washington because of a sense that the states and cities couldn’t manage their burdens on their own. After that, though, money got tighter and federal attention to state and local issues began evaporating.
Medicaid, urban renewal, community development, and education money all started to flow in the 1960s, and the flow has turned into a torrent over the decades. Data from latest Analytical Perspectives by Office of Management and Budget demonstrates the upward trend:
Federal grant outlays were $461.3 billion in 2008 and are estimated to be $567.8 billion in 2009 and $652.2 billion in 2010. These amounts include grant funding provided by P.L. 111–5, the American Recovery and Reinvestment Act of 2009 (Recovery Act). The $106.5 billion increase in grant outlays estimated for 2009, and the further $84.4 billion increase in 2010, stem largely from funding provided in the Recovery Act, along with increases in Medicaid spending apart from the increased funding provided in the Recovery Act.