This study describes the history and the current operation of the federal grant system and suggests model provisions for legislation authorizing block grants. It also describes the political consequences of the Reagan proposals, particularly the challenge these proposals present to special interest groups and to congressional working arrangements and relationships. The concluding chapter presents a framework for a broader revision of responsibilities. The federal government would assume policy and financial responsibility for the welfare system and for the provision of national health insurance. At the same time, it would transfer to state and local governments programs such as education, transportation, community and economic development, social services, law enforcement, and the environment.