Question

In the United States, the federal government pays for a considerably larger share of social welfare spending (i.e., spending on social insurance programs to help low-income, disabled, or elderly people) than it does for education spending for grades K–12. Similarly, state and local governments provide a larger share of education spending and a smaller share of welfare spending. Is this a coincidence, or can you think of a reason for why this might be so?

Answer 1

The Federal government contributes more in social security spending, whereas the state government contributes more in educational spending. The reasons behind the nature of contribution can be found in the overall objective of the different government. The federal government focuses upon the welfare of poor people, runs programs like Medicare and Medicaid programs as well as Federal sponsored health care policy, other than the welfare programs for marginalized communities. So, to meet these objectives, federal government has to finance these programs and contribute more. In contrast to it, state government focuses upon the human capital development program that is very specific to the state. Each state differs from the other states and make customized plans. Accordingly, contribution towards spending upon education and skill development takes place and state economy grows. In this way, federal and state government complements each other.