Simple solutions: stop wasting money on federal agencies

Authored by Frank DeVito

Why federalism? Why embrace a system where issues are handled by the state and local government as often as possible, rather than in Washington, DC? There are several cogent answers to the question, both philosophical and practical.

As the federal government appears unable to pass a reasonable budget, another potential government shutdown looms. The federal government is so large and so full of money, agencies, and programs. Yet the government seems unable to responsibly steward all that money in a way that efficiently benefits local communities. In such an environment, when American taxpayers remit trillions of dollars per year to the federal government and that government seems unable to spend prudently in the best interests of the people, perhaps it is time to seriously recommit to federalism. There are certainly legitimate functions of the federal government and therefore reforms are needed to more responsibly tax and spend at the federal level. But instead of merely concentrating on federal reforms, we should consider reforming the federal government by severely reducing it.

Pope Pius XI. The principle of subsidiarity is a major theme in Pius’s Quadragesimo anno and several other Roman Catholic encyclicals.

Many Christian thinkers rightly appeal to the principle of subsidiarity, which “holds that nothing should be done by a larger and more complex organization which can be done as well by a smaller and simpler organization.” This is quite rational. Different communities have different problems, different cultures, and different priorities. The smaller and more local institution will almost always be more attuned to the needs and nuances of a local problem than a large, complicated, faraway institution. On that basis alone, it is worth appealing to federalism and keeping as many policy issues out of the hands of the federal government as possible.

The subsidiarity argument is consistent with the American tradition. The Constitution provides limited powers to the federal government and reserves all remaining powers to the states. This limit on federal power both prevents the over-centralization of power that the Founders feared could lead to tyranny, while allowing each state to respond to its own unique needs.

As the post-New Deal world has watched federalism crumble with the rise of huge federal agencies, conservatives must make these principled arguments about the dangers of federal overreach. Yes, over-centralization of local problems violates subsidiarity and prevents local communities from finding better solutions. Yes, this arrangement where massive federal agencies dominate local policy is offensive to the founding vision of the country (and is likely unconstitutional, at least sometimes). But there is an additional argument, one that is simple and speaks to people who may not be principled policy wonks: federal agencies loaded with tax dollars are often an inefficient waste of the people’s money.

It is worth highlighting the reality of federal taxation here. The people are taxed by the federal government, which means dollars earned in local communities are sent to Washington, DC. There, many of those dollars end up in the budgets of federal agencies. A portion of the money goes to pay the federal employees in those agencies, who then set priorities and policies at the federal level. Later, the rest of the money is sent back to the states in the form of grants or special programs. Why do we tolerate this, when instead we could keep our tax dollars closer to home in our local and state governments?

…this arrangement where massive federal agencies dominate local policy is offensive to the founding vision of the country.

The inefficiency of federal government spending is apparent in many fields, but one particular example illustrates the point well: the US Department of Education. As Josh Herring noted, “[s]chool choice applies the . . .  logic [of federalism] to education. All property-owning citizens create the tax base that funds public education, but the needs of students and communities are far from identical.” From a federalism perspective, there is no express power given by the Constitution to the federal government to justify a federal agency that oversees education. And practically, because students and communities are diverse, education policy is best handled at the local level anyway.

The Department of Education provides a perfect example of the inefficient flow of money that often takes place when the federal government intervenes in a local issue. One should be shocked by the Department of Education’s budget: the department has requested $90 billion in discretionary funding for its 2024 budget. A little over $20 billion is intended to foster K-12 education in low-income communities. Additional funds are earmarked for pre-K, student health, disability services, and a variety of other educational endeavors. Additionally, the department is requesting $3.5 billion of this 2024 budget for its salaries and expenses budget account.

What is the purpose of this flow of money from the taxpayer to the federal government? Taxpayers have an interest in providing schools for their communities. They already pay state or local taxes that fund their school systems. Why, then, is an additional $90 billion in federal taxes being collected from the people for education? As the 2024 Department of Education budget request shows, a large percentage of these funds are returned to local school systems in the form of grants. Why do we need this Washington, DC-based middleman?

The short answer: we probably don’t. Putting aside the sheer inefficiency of this system, these federal grants come with policy preferences, often with strings attached. As the priorities in the budget request reveal, the federal government spending plan includes funds for mental health, low-income areas, and even a $100 million request for diversity initiatives.

Some of these policy decisions may be reasonable or even good, while others reflect poor policy choices. But regardless of one’s opinion of the Department of Education’s priorities, the reality is this expensive federal middleman must provide a serious benefit, something that simply cannot be accomplished by local or state governments, to justify this level of federal spending. And there is no apparent reason why these initiatives (funding education for children with disabilities, children from low-income communities, etc.) cannot be funded by state and local school systems themselves. Unless the federal government is offering something that no state or local government can provide (which it is not), the federal Department of Education has no justification for its existence.

Since there is no major beneficial purpose justifying this federal education system, it is unacceptable that billions of dollars from the Department of Education budget are not even returning to actual school systems but are being paid to Department of Education employee salaries. Everything that the Department of Education does could be done on a more local level. School districts can provide their own programs for student health or children with disabilities. State education departments can identify underperforming districts and seek local solutions. Washington, DC is too far removed from any of these issues to be the most effective way to remedy them. Therefore, there is no conceivable reason that billions should be spent on the salaries of federal employees working in a field wholly inappropriate for federal government involvement in the first place.

Florida Gov. Ron DeSantis is one of the GOP candidates vowing to nix the Department of Education.

This is not a niche argument without a support base. The Department of Education has become the subject of animosity among Republicans in recent years; four presidential candidates in the first GOP primary debate called for the elimination of the department altogether. As culture wars rage around charter schools, school choice, critical race theory, and gender ideology, it is no surprise that conservatives set their sights on the Department of Education. The strings attached to education funding from the federal government have become so ideological that at least two states are considering rejecting funds from the Department of Education altogether. While such a move is understandable in the current climate, it is a shame that things have become so politicized that a state is considering rejecting funds paid by its own taxpayers, meant to benefit its own taxpayers.

The financial inefficiency argument needs to be brought into the mainstream to challenge many aspects of our federal government. Perhaps the Department of Education is the most politically expedient place to start implementing this argument and making a drastic change for the health of the nation. But the argument in this essay should be carried into everything from public health to labor policy, always raising a series of baseline questions: Is there a policy issue that truly cannot be handled at the local or state level? If the answer is no (and if the question is addressed honestly, often the answer is no), why should the taxpayers be subjected to a system where their dollars are sent to Washington, DC to pay federal employees to write policies, attach strings to the remaining dollars, and send those dollars back to the states? Why not cut out the federal middleman?

Policy professionals and political theorists deal with complicated issues, and often their arguments are quite dense. Sometimes this is necessary. But there are times when a major area of policy need not be cluttered with complexity; sometimes the most convincing argument can be articulated simply. The crucial argument that federal agencies are financially inefficient and wasteful, and that often they should be cut back or eliminated in favor of local and state government, is simple enough. Taxpayers are seeing their dollars wasted to pay federal bureaucrats to do something that can be done more efficiently and more effectively at the local level. Local and state governments can often provide better answers, more suited to the needs of a particular place, for less money. Sometimes, it is as simple as that.

Frank Devito is an attorney at Napa Legal Institute, a religious freedom organization focused on nonprofit law, public policy, and legal talent development. His work has previously been published in several publications, including The American Conservative, The Federalist, and First Things Online. He lives in eastern Pennsylvania with his wife and children. The views expressed in this article are those of the author and not necessarily his employer.

Authored by:Frank DeVito


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