Introduction
During the first half of 2025, a series of federal actions, employee reductions and cost- cutting proposals have begun to pull back billions of dollars that previously had gone to states, cities and counties. As a result, we’ve entered an era in which state and local governments must make dramatic changes in the way they do business. These changes will impact the governments themselves and the individuals they serve — as well as private sector entities that depend on government services and contract with states, cities and counties. “The federal government is the only entity capable of assisting
local and state governments’ infrastructure and resources from being overwhelmed,” said Clarence Anthony, CEO and executive director of the National League of Cities. “Cities, towns and state governments alone are not prepared to fill the gap from the federal government potentially pulling back from its current role.” This is reminiscent of the “New Federalism,” that was part of President Richard Nixon’s agenda. But while Nixon’s plans were for a shift of responsibility, money and power to the states in collaboration with the federal government, the current administration’s shift of responsibilities requires lower levels of government to figure out how to deal with a cadre of life- and-death issues on their own.
Note: This is the first in a two-part series examining the impact of federal policy and funding changes that are pushing states and localities in key areas. This installment covers cybersecurity and disaster toward greater self-sufficiency preparedness and response. Part two will cover health care, social services and education.
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