Evening star., 1939-04-11
Gerry Warns States
Against Increasing
Federal Power
Senator Sees Trend for
Greater Grunts as Step
Toward Bankruptcy

Senator Peter Goelet Gerry, Demo-
crat, of Rhode Island discussed the
subject, Federal Grants-in-Aid to
the States" last night in the Ma
tional Radio Forum, arranged by
The Star and broadcast over a Ma
tion-Wide network Of the National
Broadcasting Co. The text OF his
address follows:
In the first place I desire to ex-
press my thanks to The Evening
Star and the National Broadcast
ing Co. for making possible this
broadcast.
The question which I am to dis
cuss Is giving serious concern to
many OF us In Congress. It's i'm
portance Is not generally recognized,
but I believe it should challenge the
thought of all OF us. In the short
time that Is allowed 1t is my inten-
tion to speak Of the Federal grants
in aid to the States.
At the outset, it should be made
clear that there are some cases where
it is quite reasonable that these
grants in aid should be extended.
For example, the depression. at the
beginning, dealt such staggering
blow to our people that FEDERAL
assistance had to be given promptly
if the country and it's citizens were
to meet the emergency. That is not
a part of my discussion tonight. l
am endeavoring to confine myself
to what should be considered the
normal activities for the Federal
and State governments.
1t might be we'll, in the beginning,
to define the term Federal grant
in aid" 1t has been described by a
student as "a mechanism to effectu-
ate national policy or to promote
the performance of a service on a
Nation wide scale" A more realistic
and descriptive definition might we'll
be that it is gift or bribe by which
the National Government induces
the States to do what the States
otherwise could not or would not do.
Practice Still Growing.
But it cannot be denied that the
practice has grown and is still grow
ing by leaps and bounds. Where
in 1920 there were s37,000000 paid
to the States. in 1886 the amount
had exceeded 1894 100000. This does
not take into account the several
billions of dollars granted to the
States for relief purposes.
Some of these grants are so firmly
entrenched that it will be very diff
ficult to uproot them. Perhaps the
best hope lies in checking the ever
increasing list Of new services.
In addition to the tremendous in
crease in payments by the Federal
Government, two significant changes
in practice must be noted The first
is the substitution of the outright
grants for the old principle of the
so-called matching of State funds
dollar for dollar with the Federal
funds. The secondhand it is to be
observed that it is incorporated in
two extremely important measures
pending before Congress-is the pro-
posal to make the grants to the
States not on the basis Of popula-
tion or the amount that the State
itself is willing to contribute, but
upon a formula that seeks to estab-
lish the financial need of the States.
Some one may ask, isn't the
Federal Government much richer
than the several States and isn't it
desirable to have it help the States
out?" In answer to such a question,
it must be said. and said again. that
! the Federal Government has no
| funds of its own, and when Congress
decides to make one of its alleged
presents, it sends the tax collector
out to tax its citizens, among them,
the beneficaries of the gift. Whether
the State which is induced to follow
the policy Under the gift likes the
program or not, its people are taxed,
! and If frills and furbeloWs are add
| ed they are taxed more
Less Vigilant Over Rights.
Here the remoteness and aloof-
ness of the Washington bureau has
its deadly effect. When a city or
State is paying directly for a service,
the voters are quick to ask whether
the service is being we'll carried out
and if they are getting full value
for their money All officials real
i7e the stricter accountability that
is involved. 1t has It's origin in the
citizens knowledge that what he
thinks about local matters carries
real weight, while his ideas on State
problems carry less and when a
EnInro1 n1iocfiay, tc iyoy,N1x,eI H.; -,
f1uence is almost negligible. He feels
helpless in protesting the adminis-
tration of Federal grant, and since
the idea is inculcated that it is a
gift, he is less vigilant as to his
rights. The fact is not stressed that
where he is given one dollar, fire.
quently much more than that will
be taken from him to pay for it..
On the other Hand, let city or State
officials carry on an extravagant
program and the prospects will be
good that they will lose their Of
| fetal heads.
The critical nature of the States
| problem in raising the necessary
taxes is reflected on all sides. Why
| uO we 1lllu OJdUco ldAlllS IIl6 ROOOS
of sister States coming within their
| borders? Why are new and strange
methods of raising revenue being
improvised? The answer is ismple.
1t is because the Federal tax collec-
tor has already exhausted the or
dinary methods of raising revenue.
More and more the States are find
ing that little is left for them, but
still the Federal grants continue, still
the costs to the States grow, and
still the burden on the taxpayers
becomes heavier. The practice can
not go on indefinitely. I say with
deliberation that if the trend of in
creased Federal grants continues, the
States as we have known them will
be unable to exist, or they will ex-
ist as bankrupt and powerless pawns
of the Federal Government-no
longer self-sustaining governments
but merely vassal communities, COM
| ing with hat in hand to beg for