State Aid and Political Centralization

The US appears to be headed for political centralization in spite of her Federal constitutional republic government framework.

And this is due to the growing dependence of US States on Federal Aid (“grants in Aid”) Programs.

Cato’s Chris Edwards enumerates why state aid programs negatively impacts the economy.

1. No Magical Source of Federal Funds

2. Aid Spurs Overspending

3. Aid Allocation Is Inefficient

4. Aid Reduces Innovation

5. Aid Is Intensely Bureaucratic

6. Aid Distracts Federal Politicians

7. Aid Breeds Irresponsibility

8. Common Problems Aren’t Necessarily Federal

Read Mr. Edwards explanation here.

The point is the broadening dependence of US states on federal government aid has been undermining the decentralized political power structure, and importantly, has been diminishing political and economic freedom.

And applied locally, even if the Philippines has yet to embrace federalism, any attempt to decentralize via Local Government Units would signify a sham if only to remain dependent on the largesse of the national government. (my latest article on MMDA should serve as an example)