1.9 Federalism in Action

Grants: the money strings

The federal government uses grants-in-aid to influence state policy. Categorical grants come with specific conditions on how money must be spent, giving Congress more control. Block grants provide funding for broad policy areas with fewer restrictions, giving states more flexibility. States often prefer block grants; Congress often prefers categorical grants for accountability.

Mandates and preemption

Mandates require states to comply with federal laws, sometimes without funding (unfunded mandates), which strains state budgets. Preemption occurs when federal law overrides conflicting state laws, based on the Supremacy Clause. These tools show how federal power can expand into areas traditionally left to states, fueling debates over federalism's balance.

Devolution and ongoing debate

Devolution is the transfer of power from the federal government back to the states, often through block grants (e.g., welfare reform in 1996). Federalism remains dynamic — competing views on the proper balance between national and state power continue to shape policy debates on issues like healthcare, education, and environmental regulation.

Key terms

Categorical grant

Federal funding given to states with specific conditions on how it must be spent.

Block grant

Federal funding for a broad policy area, allowing states more flexibility in spending.

Mandate

A requirement imposed by the federal government that states must follow, sometimes unfunded.

Preemption

When federal law overrides conflicting state law, based on the Supremacy Clause.

Devolution

The transfer of power and responsibility from the federal government to state governments.

Try an AP-style question

What does this illustrate?

1. Judicial review
2. A block grant
3. The supremacy of state law
4. Tension in federalism