What Are Block Grants?

IN MARCH, Speaker of the House Paul Ryan shared his excitement about block grants. “We are de-federalizing an entitlement, block granting it back to the states, and capping its growth rate,” Ryan said. “That’s never been done before!”

Ryan’s enthusiasm should be alarming, not exciting, for Christians. The block grant model is a dangerously ineffective way to protect people when they are economically vulnerable.

What’s a block grant and what’s it good for? A block grant is a fixed amount of unrestricted funding made by the federal government to a state. Traditionally, block grants have been used for law enforcement, school systems, and public transportation, allowing states more flexibility in administering programs as well as the ability to experiment.

Generally, block grants have not been used for entitlement programs, which include Social Security, Medicaid, Medicare, the Supplemental Nutrition Assistance Program (formerly known as food stamps), and Supplemental Security Income, among other programs. Why? Because doing so cuts gaping holes into the safety net that these programs offer those who are struggling, and because “experimenting” with people when they are sick, poor, disabled, or elderly is abhorrent. Scripture is unequivocal on this: We are to honor our elders and care for the poor, widows, orphans, and strangers—the most vulnerable among us.

In congressional budget debates, entitlement programs are often scrutinized for short-term savings because they are big-ticket items. Currently, entitlement programs are funded through the federal government in such a way that anyone who qualifies for the benefits can receive them. Spending on these programs expands and contracts with the economy—with people’s need—rather than the budget cycle.

While proponents argue that block grants provide states with more flexibility to improve services, it’s more likely to have the opposite effect: Amid competing state mandates, safety net and entitlement programs may become more vulnerable to cuts, with funding drastically reduced over time. High-risk changes in the funding structure could fundamentally shift how entitlement programs are administered, undermine their effectiveness, and, perhaps most important, leave millions of eligible citizens without their basic needs met.

First, shifting the administration of these programs to states is problematic because states, many of which are facing their own budget deficits, could allocate the federal “safety net” money in whatever way they decide. This leaves the programs susceptible to future cuts and the people who depend on them at greater risk. For example, Aid to Families with Dependent Children was “block granted” in the 1990s and renamed Temporary Assistance to Needy Families. Since then, the program has steadily declined, and about a quarter of families who need assistance receive it.

Additionally, block grants often do not require states to adhere to federal standards. Instead, states can change program eligibility requirements based on their own criteria. When states are not required to provide an effective social safety net, they often don’t. This not only endangers families in need but pushes increased costs down the road onto other tax payers.

Finally, the current formula allows funding adjustments to occur in the case of economic downturns, natural disasters, and unexpected factors that result in higher numbers of people needing temporary assistance. Block grants do not allow states to respond to changes in need when there is a recession or natural disaster. States receive a fixed amount of funding regardless of whether there is a dramatic increase in need. This means that states must figure out how to respond to the unexpected increase in need, which may result in changes to eligibility requirements, cuts in benefits, waiting lists, or needs simply going unmet for the most vulnerable.

For Christians, there is no cause for excitement in Ryan’s suggestion of “de-federalizing an entitlement, block granting it back to the states.” Not only is it a bad idea, it’s an unjust one.