Trump’s Budget Threatens States and Their Residents

President Trump’s 2021 budget would slice federal aid to state and local governments that provides health care, K-12 education, and more.

Large federal aid cuts would do lots of damage in states. Federal grants provide roughly 30 percent of state budgets across the country, and over 40 percent in some states, according to the most recent data (see table). The President’s budget would sharply cut Medicaid — the largest single source of federal funding to states. Plus, it would deeply cut funding for non-defense discretionary programs, the part of the budget that includes most other grants to states, including funding for schools, child care, and housing assistance.

States would probably respond to such deep cuts primarily by reducing the services they provide to their residents, likely worsening economic inequality and racial disparities.