I believe, in answer to the first part of your question, that it is essential, during this era of economic uncertainty, that the Federal government ensure that states have sufficient funds to maintain their infrastructures. In answer to the second part, I would respond largely in the negative, with one significant caveat. Federal funds designated for the emergency maintenance of a state’s infrastructure ought only be accepted on the condition that they be used for their stated purpose. That is to say, if the Federal government sends aid to a state to help maintain its medicaid facilities without cutbacks, then that’s what the money should be used for; not for vanity building projects, or paying back debt to multinationals. Other than that, I believe the funds should be given without strings. I oppose Federal overtures on the right of states to determine their own policy. I think it’s counterproductive and hubristic for Washington to decide to tell a state how to run its own schools. It’s a truism that “All politics is local”. Well, I happen to believe that the vast preponderance of political solutions are local, too. State officials, who have the power to observe local problems directly, and who have the ability to gather data directly from the point of origin, are almost always best placed to recommend solutions to local problems. If Washington gives a state a grant for maintaining, say, teacher salaries, they should have the wisdom to allow states to use those funds the way they see fit, without prescribing onorous, “One size fits all” solutions themselves. This is, of course, bearing in mind the caveat that funds allocated for teacher salaries be used for teacher salaries, and nothing else.
But why do I believe that Federal aid should be supplied in the first place? Is it the responsibility of citizens in Missouri to finance the school budgets of the state of Maine, or Massachusetts? In response, I simply ask, what is the alternative? A New York Times investigation broke down the figures for state aid from the most recent round of fiscal stimulus thusly:
$87.1 billion - Medicaid costs.
$53.6 billion - Education.
$25 billion - Job creating incentives in economically distressed areas.
$22 billion - School maintenance.
$4.2 billion - Unemployment insurance.
These services are all crucial to the maintenance of civil society. Moreover, in this current economic climate, a great many states are experiencing significant budget shortfalls which have impacted their ability to provide in these key areas. According to the Centre on Budget and Policy Priorities, only 6 states, Alaska, Arkansas, Montana, North Dakota, West Virginia, and Wyoming, are not projected to have a significant budget shortfall in this fiscal year. I ask you, if the Federal government is not to assist the other 44 states in meeting their most fundamental obligations, what would become of the poorest and most disadvantaged citizens of those states? What would become of our fragile economic recovery, if 90% of the states started laying off teachers, police, and firefighters en masse?
In August 2010, the House approved a $26.1 billion stimulus which, it is estimated, saved the jobs of almost 140,000 teachers nationwide. This, to me, represents an excellent use of Federal aid. The last thing this country needs in these times is the addition of 140,000 professional educators to the ranks of the long-term unemployed.
It’s easy for people to look at the amount of Federal funds spent on state aid and say “It’s not my problem.”. It’s not so easy to stand in front of a low income family and tell them that their access to medicaid - to lifesaving blood pressure medication, to chemotherapy - may be compromised because state funds have been squandered trying to plug budget gaps caused by an economic crisis which has echoed on down from the highest echelons of society, and to which they contributed not one iota. Also, to tell them that their kids will lose their favourite teacher and, oh yes, if they happen to be victims of crime they should get in line and take a number because there are fewer police to help them.
I share snowmaster’s concerns about transparency and accountability. Citizens have the right to know which of their tax funded services are provided by their state, and which are provided or subsidised by the Federal government. To this end, my administration shall run an ‘Open book’ accounting process to make it as easy as possible for citizens to track just how their state and federal taxes are used.
I see the moderator signalling frantically at me, so I shall conclude by saying, in summary, that the great preponderance of Federal aid at this time is devoted to essential infrastructure support, should be given as needed, with a minimum of requirements the better to allow states to disburse the funds in a manner most in line with local priorities, but that Federal funds should always be used for their stated purposes. Beyond this cabeat, further administration should be left up to the states. And be assured that my administration will never forget the importance of accountability. Thank you.