Goals of this exercise

• Illustrate the increased use of grants-in-aid in administering national policies.
• Demonstrate the differences between “categorical grants” and “block grants.”
• Examine the strategic goals of national and state policy-makers in advocating the use of “block” versus “categorical” grants.

Federalism and the Politics of Grants in Aid

• Since the New Deal, the national government has played an increasing role in encouraging and even coercing states to administer federal policies.
• Central to this evolving relationship has been the federal government’s use of grants-in-aid to encourage states cooperation in implementing federal policies.

• Increases in federal grant-in-aid outlays throughout the second half of the 20th century exemplify the increased role of the national government in the federal balance of power.
• Political actors in the national government establish these grant programs with varying degrees of flexibility and discretion to state governments.

Categorical Grants

Categorical Grants are federal grants given to state and local governments to encourage their cooperation in implementing specific purposes and programs.

• These give less flexibility to state governments.
• Federal officials place significant restrictions on states that accept grants and are quite specific about how funds are to be spent in specific policy “categories.”

Block Grants

Block Grants are federal grants-in-aid that allow states considerable discretion (within broad limits) about how the funds will be spent.

• These give greater flexibility to state political actors to tailor programs to the state’s particular needs.
• The federal government places few restrictions on how states are to spend funds within broad programmatic areas.

The Politics of Grants in Aid: Devolution

When Republicans took control of Congress after the 1994 elections, their “Contract with America” sought to “devolve” control of many federal programs to the states often by replacing existing categorical grant programs with block grants programs.

• Welfare Reform: Republicans replaced the federal AFDC entitlement welfare program with TANF that provided block grants to state governments to reform welfare.
• Crime policy: With the Taking Back Our Streets Act, Republicans replaced the Clinton Administration’s crime bill’s specific programs and grants to state and local governments again with block grants to states to fight crime as they saw fit.

Devolution in Welfare Reform

Devolution in Crime Policy

Examining Rationality Principle #1

Principle #1: All political behavior has a purpose. All political actors engage in instrumental acts designed to further their individual goals.

Question 1. How does the use of block grants help state policymakers to meet their individual policy and political goals?

Question 2. How does the use of categorical grants help federal policymakers control the policy activities of state and local governments and benefit federal policymakers politically?

Examining Rationality Principle #4

Principle #4. Political Outcomes are the products of individual preferences and institutional procedures.

Question 3. How might states use and/or abuse the flexibility given them under the TANF block grants program in addressing problems associated with poverty and welfare?

Question 4. Consider the differences in the crime problems of Illinois, California, and New York on the one hand versus North Dakota, Kansas, and New Hampshire. What effect does establishing a rule allowing states greater flexibility to address crime have on policymaking?

One step further ...

Explaining Republican Motivations to Devolve Power

Question 5. Why would Republican national policy holders give up discretion over the implementation of policies?

Question 6. Consider policymaking via grants-in-aid as a federal solution to the collective action problems associated with getting states to work together. What are the potential problems of establishing rules that devolve power to the states?

Citations

• James G. Gimpel, Legislating the Revolution: The Contract with America in Its First 100 Days (Boston: Allyn and Bacon, 1996).
• House Report 104-024. Local Government Law Enforcement Block Grants Act of 1995 (Washington, DC: GPO, 1995).
• Harold W. Stanley and Richard G. Niemi, Vital Statistics in American Politics, 2003-2004 (Washington, DC: CQ Press, 2003).