My good friend Ben Lusty published a piece on Congressional use of it’s funding power to influence education policy in the states. Because I feel like the tension between the states and federal government merits scrutiny, especially when money is at issue, I have reprinted Ben’s piece here with his permission.
By Ben Lusty
Deseret News Published: Friday, Aug. 20, 2010 12:03 a.m. MDT
Congress last week passed the Education Jobs and Medicaid Assistance Act. The act is a $26.1 billion bailout for states. But there is a catch: States must not cut education spending and must
pay each federal dollar to a teacher (the vast majority of whom are dues-paying union members). The bill intrudes into state sovereignty by dictating the way state legislatures spend their residents’ tax dollars, and nowhere is this more evident than Texas.
Congress singled Texas out for special treatment. To qualify for $820 million in aid, Texas must maintain its current level of educational spending until 2013. This command is retribution for Texas using some $3 billion in stimulus funds to plug a budget gap last year, rather than hiring more teachers as Congress wished. The governor of Texas must commit to maintain spending levels, even if that means raising taxes on Texans. The problem is that the state constitution prohibits the governor from promising to maintain funding levels. Only the Texas Legislature can direct state spending. Texas is thus on the very long horns of a dilemma: Forgo needed money, or violate its constitution.
Congress has some power to direct state action. There is no doubt that under the taxation and spending clause of the Constitution, Congress can require a state to do certain things in exchange for federal money. Congress used to require each state to keep a 55 mph speed limit as a condition for federal funds. Because states are free to choose whether they participate in these programs, these conditional grants are legitimate.
But congressional power over the states is not unlimited. The Supreme Court has ruled Congress may not “commandeer” a state government. Congress may not, for example, require states to pass taxation laws. Neither may Congress require state police agencies to enforce federal handgun laws. In South Dakota v. Dole, the Supreme Court even held that in some circumstances, “the financial inducement offered by Congress might be so coercive as to pass the point at which pressure turns into compulsion.” That is, at some point, the amount of money at stake is too much that a state simply cannot turn the money away and must, as a matter of reality, concede to federal power.
The education bailout is troublesome to state sovereignty. In exchange for money, Congress requires states, particularly Texas, to surrender discretion regarding education funding. True, the states could decline the funds, but that is not realistic considering the fiscal desperation many states are enduring. Whether the financial inducement offered by Congress is compulsive under the Constitution is difficult to say because the Supreme Court has never said at what point the “financial inducement” becomes compulsive. And in any event, Congress is not threatening to withdraw existing funding to states.
At its heart, though, the education bailout is a mutual taxation and spending covenant between the states and the federal government, foisted upon the states by Congress’ superior power position. And it is bad policy. State legislatures are better placed to understand and respond to their own fiscal needs. Perhaps states have overspent on education and should be spending less, not more, as their legislatures judge best. Why should a senator from Virginia direct Texas educational spending? Congressional funding is a blunt instrument for delicate state finances. The Constitution envisions the federal government abstaining from meddling with state treasuries. The education bailout, however, pushes the federal government even deeper into each state’s treasury and in some cases between a state and its own constitution.
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