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The Federal Extortion Racket

The Federal Government has developed an interesting method that they use to make the States obey them. They extort the States with money. In other words, they develop some sort of federal program (usually unconstitutional) that they want the States to adopt and then say that if the States adopt the program they will give them money to support it but if they do not adopt the program they will get no money. These are usually things like school lunch programs, Common Core, the Affordable Care Act or whatever other social program the Federal Government wishes to impose upon the States. The Federal Government also uses money to bail out failing States that support their political agenda and help create the illusion that these States are not having any financial problems.

The Founding Fathers never envisioned how the Federal Government would become such a massive money collection apparatus and never foresaw that it would use this apparatus to impose its will upon the States and abort the constitutional provisions for limited government. The ability to control State operations through this apparatus has given rise to the massive federal government operation we see today that seeks to control all aspects of life in America. If we are ever to return to a limited federal government this constitutional oversight must be addressed.


Ideally, we would want a Constitutional Amendment that would address this situation. That Amendment should have the following provisions:

— The Federal Government may not send any Federal Funds to any governmental entity below the State level.

— The Federal Government may only send money to the States in the form of a block grant with no spending restrictions attached. The States may spend the money block granted to them in any manner they so desire.

— The Federal Government may not send money to the States as loans, may not buy their bonds, or send money in any other form other than the block grants mentioned above.

— When the Federal Government remits money to any State they must send an equivalent amount of money to all the other States in like kind based upon population.

— The only exceptions to these rules occur when a State has a natural disaster, in which case separate federal legislation may apply.


So, for example, if California has 40 million people and Wyoming has ½ million people and the federal government sends California $40 million they must also send Wyoming $500,000 and every other State an equivalent amount based upon their population. The federal government may say that this money is for education (or anything else) but the State may spend it on anything they wish. This is in effect like a rebate program and if the States feel that the Federal Government is being too stingy they now have certain recourses more readily available.

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