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Presidential Issues: Budget


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Time for Real Federalism

April 18, 2013

By Doug Bandow

Everyone except President Barack Obama understands that the federal government has a spending problem. Yet Uncle Sam gives away more than $600 billion to states and localities every year. It’s time to turn off the spigot, implementing the Reagan vision of transferring program responsibilities and revenues sources away from Washington.

The original governmental system for the newly independent colonies envisioned states funding the national authorities. There was no enforcement mechanism, so the Articles of Confederation didn’t yield a very effective continental government. But the principle made a lot of sense. The best way to constrain national politicians was to make them dependent on local folks for money. No extravagant usurpations of the liberty of citizens or authority of states.

The Articles were tossed aside when the Constitution was ratified. It provided the so-called federal government with independent sources of revenue, but still envisioned states playing the dominant government role in citizens’ lives. The national government primarily relied on tariffs and the proceeds of land sales for money. Washington had no seemingly endless source of cash either for its own use or for distribution to others...

Read the full article at the Cato Institute: Time for Real Federalism

Issue Categories : Budget, Federalism