๐ Topic Summary
Fiscal federalism is all about how the federal government and state governments share funding and responsibilities. Think of it like a financial partnership! ๐ค The federal government uses grants to influence state policies, and states have to manage their own budgets while dealing with federal mandates. Understanding this balance of power is crucial for AP Gov!
๐ง Part A: Vocabulary
Match each term with its correct definition:
| Term |
Definition |
| 1. Fiscal Federalism |
A. Funds given by the federal government to states for specific purposes. |
| 2. Block Grants |
B. Federal rules that states must follow, whether they receive federal funding or not. |
| 3. Categorical Grants |
C. A system where the federal government and state governments share powers and policy assignments. |
| 4. Mandates |
D. Funds given by the federal government to states with few strings attached. |
| 5. Revenue Sharing |
E. Distributing a portion of federal tax revenue to state and local governments. |
(Answers: 1-C, 2-D, 3-A, 4-B, 5-E)
๐ Part B: Fill in the Blanks
Complete the following paragraph using the words provided:
(federal, state, mandates, grants, fiscal federalism)
__________ describes the financial relationship between the __________ government and the __________ governments. The federal government often uses __________ to encourage states to implement certain policies. However, unfunded __________ can create tension between the two levels of government.
(Answers: Fiscal federalism, federal, state, grants, mandates)
๐ค Part C: Critical Thinking
Explain how fiscal federalism can both strengthen and strain the relationship between the federal government and state governments. Provide specific examples to support your answer.
