Federal Government Impact

Every state in the nation relies on the federal government for financial aid. Fiscal irresponsibility, specifically uncontrolled spending, strains the relationship between the states and federal government. Even though states have so-called "balanced budgets," budget gimmicks are widespread, increasing states' reliance on consistent federal assistance. As the federal deficit tops $15 trillion, lawmakers in Washington are instituting severe financial cutbacks to discretionary programs, including funding that states heavily rely on to finance day-to-day expenses.

Some states have taken steps to decrease their reliance on federal funding, but immediate action is necessary to ensure the fiscal solvency of the states. In order to break the cycle of fiscal dependency and reckless spending, state legislators and citizens must understand the impact that the federal government has on state budgets. That's where State Budget Solutions comes in.

 

  • Breaking News
  • Research
  • Solutions
  • Blog and Opinions
    • HEADLINES: Illinois

      State action urged to stop pension debt from ballooning

      The Chicago Sun-Times | by Dave McKinney | January 30, 2012

      Illinois' multibillion-dollar pile of unpaid bills will quadruple within five years unless steps are taken to curtail state pension and Medicaid spending, a government watchdog concluded Monday in a new analysis of the state's budget.

    • HEADLINES: Tennessee

      Haslam budget includes pay raise but some layoffs

      The Tennessean | by Chas Sisk | January 30, 2012

      Gov. Bill Haslam proposed a $31 billion spending plan that would raise pay for state workers by 2.5 percent, fund a new science building at Middle Tennessee State University and cut more than 1,100 state jobs across Tennessee.

    • HEADLINES: Tennessee

      Haslam budget expected to include new cuts, new spending

      The Knoxville News Sentinel | by Tom Humphrey | January 30, 2012

      With increases in expenses and no federal money to fall back on, there will almost certainly be some spending cuts as well as spending increases in the budget presented Monday night in the governor's annual "state of the state" address.

    • HEADLINES: Oregon

      Gov. John Kitzhaber says feds could support health reform with $2.5 billion, easing state budget crunch

      The Oregonian | by Nick Budnick | January 21, 2012

      As state officials wrestle with a projected budget hole on top of $640 million in health cuts, they are counting on a federal lifeline of $2.5 billion over five years.

    • HEADLINES

      States once again worried about budget fights

      MSNBC.com | January 19, 2012

      The National Conference of State Legislatures, which represents lawmakers from across the country, sent President Barack Obama, Speaker of the House John Boehner and Senate Majority Leader Harry Reid a letter urging them to "examine all possible avenues for deficit reduction, including discretionary spending, entitlement reform and revenue-related options."

    • View All Breaking News

    • SOLUTIONS: Maine

      Fixing Maine’s Welfare System

      Maine Heritage Policy Center | December 7, 2011

      Fixing Maine's welfare system requires embracing a Wisconsin-style approach and keeping the system focused on promoting work and self-sufficiency. Maine's current welfare system does just the opposite, trapping people and families in poverty and promoting dependence and an overreliance on government.

    • SOLUTIONS: South Carolina

      Ditching No Child Left Behind – all of it

      The South Carolina Policy Council | December 2, 2011

      South Carolina should refuse federal No Child Left Behind Funds and the accompanying mandates and find a way to fund poor school districts adequately.

    • SOLUTIONS

      Breaking the Cycle of Federal Dependency

      State Budget Solutions | by Kristen De Pena | November 22, 2011

      In the wake of the failures of the famed "Super Committee," $1.2 trillion in automatic cuts go into effect in 2013, and those cuts will undoubtedly impact state budets.  Although multi-faceted, the problem is clear: states must learn to fend for themselves financially.

    • SOLUTIONS: Nebraska

      Medicaid The Need for Medicaid Reform Grows Larger After Obamacare

      The Platte Institute | by Brian Blasé and C.L. Gray, M.D. | August 1, 2011

      Replacing the current federal financing structure of Medicaid with fixed allotments to the states would help save both state and federal budgets. Without this policy change, states will dig further budgetary holes and the federal government will face an increased likelihood of a debt crisis.  If states received a non-fungible Medicaid block grant from the federal government rather than fungible matching funds, each state would have the incentive to reign in Medicaid spending.  If states were freed from the myriad federal mandates (such as the “maintenance of effort” clause of the Patient Protection and Affordable Care Act) they would gain the ability to run Medicaid efficiently.