State Finances

Federalism involves fiscal issues. The Census Bureau reports:

 General expenditures by state governments rose 2.4 percent in 2010. These expenditures totaled nearly $1.6 trillion, with expenditures for education ($571.0 billion), public welfare ($462.7 billion) and health and hospitals ($123.6 billion) representing the top three activities.

Taxes are the largest source of revenue for states, but federal grants are close behind:

These findings come from the 2010 Annual Survey of State Government Finances, which reports revenues, expenditures, debt, and cash and security holdings for each state as well as a national summary.