Baseball Crank
Covering the Front and Back Pages of the Newspaper
August 24, 2005
POLITICS: Funded and Unfunded Mandates

Via Econopundit, I see that Connecticut is suing the federal government over "unfunded mandates" in the No Child Left Behind Act, arguing that it is impermissible for the federal government to require testing without paying for the tests.

As a matter of constitutional law, this may be a bit of an uphill battle, although there is Supreme Court caselaw supporting the arguement that the federal government can attach conditions to funds it gives the states but can't outright compel the states to do things, whether it pays for them or not. As Steve Antler notes, though, it is liberals and Democrats who would be the real disappointed parties if unfunded mandates of this sort were declared unconstitutional.

Personally, I'd like to go farther and ban, all but entirely, the practice of the federal government giving money to the states to carry out policy. There may be a narrow class of cases where (1) the national interest is sufficiently imperiled to justify the federal government requiring states to follow a uniform national standard and thus justify out-of-state taxpayers footing the bill, and yet (2) the job is best carried out through the infrastructure of state/local government. Counter-terrorism, border security, and vaccination/response for epidemic infectious diseases are all potential examples of this. But the great bulk of areas in which the feds give money to states and localities are simply for services to benefit the people of that state or locality. And that means one of two things:

A. The federal government is taking taxes from the people of the state and routing it, redundantly, back to the people. In this case, why not have the taxes raised locally? That would improve the transparency and accountability of government by making clear who was responsible for deciding how much to tax and how and where to spend.

One of the worst examples is Medicaid. The Medicaid program, by providing matching funds to the states, effectively takes a big chunk of the federal budget and hands over control of it to elected officials in the states; at the same time, the incentive to use Medicaid funds drives states to spend more, ultimately costing their own budgets as well. If states simply had to choose between spending their own money or not spending it, both state and federal government would be more accountable for their own choices.

B. The federal government is taking taxes from the people of a different state or locality and diverting it. Of course, there are endless controversies over who benefits more from this, but I think most observers of Washington would have to admit that what the federal government does not do is work out a plan based on reasonable policy criteria for deciding which states and localities get a net benefit and which are net losers. Instead, the real division of funds winds up being (1) a patchwork of contradictory programs and (2) heavily influenced by which states and localities have powerful Senators and House Committee Chairs.

Now, a lot of conservatives have championed "block grants" and the like - no-strings-attached funds given to states - as a way of reducing federal influence. Cutting these off, though, would in the long run hand more real authority back to state authorities that are closer to, and thus more directly accountable to, the people. Unfortunately, it would almost certainly require an amendment to the Constitution to do this, and one that would require a sufficient number of exceptions that it would be difficult to police.

Posted by Baseball Crank at 8:53 AM | Politics 2005 | Comments (2) | TrackBack (0)
Comments

I haven't seen Connecticut's complaint yet, but I've seen the previous lawsuit filed by the NEA and a bunch of local school districts. The complaint about "unfunded mandates" is not a constitutional one, but a statutory one.

They're claiming that Section 9527(a) of NCLB is a ban on so-called "unfunded mandates."

The reason they're fighting an uphill battle is because NCLB isn't a "mandate" per se, but a condition for receiving federal education funds.

I'm not sure who I'm less sympathetic to: the federal government bribing states to enact federal policies, or states thinking they're entitled to money from the federal treasury without any strings attached.

Posted by: David Nieporent at August 24, 2005 5:25 PM

Actually Medicaid is a partly funded mandate. In states like NY the feds pick up half the cost, but more like 60% elsewhere. In many ways, Medicaid beneficiaries have the best health insurance - little or no copays, no deductibles, no limits, no caps, mandated dental coverage, including orthodontics, for children, very broad pharmacy coverage, including some over the counter medications. This generous coverage is mandated by the feds. To cope with paying their share of this states pay medical providers at rates so low that Medicaid beneficiaries have trouble finding a medical provider who will see them. Since the feds match Medicaid spending by the states, the states put a lot of effort into renaming as Medicaid things they already pay for, such as juvenile probation officers and school buses for handicapped kids.

Agree with your point about accountability. Some part of the "curse" of oil wealth in many countries has to do with government control of oil revenue. This revenue allows the government to do all kinds of things that taxpayers would never allow. Surely a large part of Iraq's difficulty in writing a constitution was that the Sunni-controlled dictatorship had all, or at least as much as he and his sons would share, the oil revenue under Saddam. Now the Kurds and Shia, in whose regions the oil is found, want this found money for themselves. Best way for Iraq to go would be to distribute the revenue to individuals on a per capita basis. Let the goernment, whether federal or regional, get its revenue through the consent of the governed.

Posted by: jim linnane at August 25, 2005 3:18 AM
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