Evening star., 1949-07-10
Federal Aid
For States Is
OnUpgrade
Grants Take Five Pei
Cent of 1850
Budget
By ChorIes MoIony

set aside for them.
It's postwar record in grants
although still short of the $2,908,-
999. 900 record high for such out
lays in prewar 1899. But the
new fiscal years planned alloca-
ton for States is a 20,0O0-fold in
crease from the first grants 10
years ago.
The Whole idea of Federal
grants to States came in for some
sharp criticism recently from
former President Herbert Hoover
He said they will lead to dictator
ship" over the States.
Then Gen. Dwight Eisenhower
said he couldn't see why the Gov
ernment should pay school aid
money to all States, suggesting
only the poor ones get it. Gen.
Eisenhower. now Columbia Uni
versity president, said we must be
careful that believers in pater-
nalism" don't get control over
public schools.
Byrnes Sees Danger
Former Secretary OF State
James F. Byrnes. long a Demo-
cratic Party stalwart. spoke of
too many people trying to trans
fer power to the Government" and
warned of the danger of "wel-
fare state
However. the State grants are
just as strongly defended in many
quarters as way to get done
things which the public wants and
would not otherwise get.
President Hoover's Commission
on Government Reorganization
says grants are definitely on the
increase. Federal officials point
out one good reason the trend is
unlikely to be reversed is that the
States now get from Federal
grants Is cents out of every dollar
they spend.
The Convention of State Cover
nors shelved a resolution which
favored whiting grants down by
20 per cent.
Started in 1879
1t was back in 1879 that the
Federal Government came through
with its first cash grant-$125, 900
for raised-letter books for the
blind.
Like other grants since, these
were funds the Government raised
through its own tax collections
and turned over to the States to
spend.
BY 1902 the cost of grants had
grown to about 100000. It
included such items as $1,005, 900
for State homes for veterans, a
program started about 1888; 81
100000 for State agricultural and
mechanical schools, started about
1891. and $7s6,0oo for State agri-
culture experiment stations.
BY 1920 highway construction
had become the big item. It ac-
counted for $20,483,000 of the
s43. AS, 900 total of Federal grants
to States that year.
New Deal Effect
Not until the New Deal came
along with its big depression
combating social welfare pro-
grams did the grants vault into
the billions class.
From $200, ,933, 900 in fiscal 1898,
the cost jumped in a single year
to $1,848,079,000. The big items
Tin fiscal 1884 were $S05, ,123, 900
for the Civil Works Administra-
ton and $707, 1852, 900 for the Fed
eral Emergency Relief Admins
tration.
Nowadays the social welfare and
health program (old age pensions,
aid to the blind, etc. is by far
the biggest State grant item, TAX
ing up s1,359, ,000, 900. or about
So per cent of the grants.
Transportation items now in
clude construction of airports as
we'll as highways. Their cost has
grown to $518.000,00 and is ris-
ing steadily, due in large part to
maintenance and improvements
deferred during the war.
Schools Take Slice
Education will account for
1923 100000 in fiscal 1850 grants
if Congress adopts President Tru-
mans proposed program of $780,
100000 a year to aid States in
financing elementary and second
ary schools.
The school proposal illustrates
the trend toward increased rather
than reduced Federal grants to
States. But the uptrend comes
from "liberalizing" old grants as
we'll as starting new ones.
Since the law provides in many
instances-like old-age pensions
or highways-that the Federal
Government must match wholly
or proportionately sums spent by
the States. the States often con-
troll the Federal outlay.
Beyond Presidents Control
Federal budget officials have
cited the grants-in-aid program
as one item in the Federal budget
that cannot be reduced by presi-
Dental action, because these are
costs beyond his control.
Old-age assistance grants, for
example, are now (since Congress
recently made them more liberaD
three-quarters of the first $40 and
one-half of any excess up to $50
a month paid to each individual.
The amount the Federal Gov
eminent spends upon them. say
officials. depends strictly upon the
individual benefit rates estab-
lished by the States and by the