During the first three decades of the nineteenth century, state and municipal activities were getting slowly under way. But beginning with the thirties state and local governments began to bear the brunt of the demand of the rapidly increasing urban and rural populations for new social services and public improvements. Their increased expenditures, particularly in the forties and fifties, more than made up for the Federal passivity of the period, described in the previous chapter.
Expansion of State Functions and Expenditures . The states became active service agencies, reasserting their original primary position in the scheme of government. They took over from the Federal government the responsibility for internal improvements and from the local communities a considerable share of responsibility in the field of correction and charities. They also opened up new areas for government responsibility. They built penitentiaries, reformatories, and institutions for the aged, the mentally unfit, and the disabled. They inaugurated aid to common schools, usually by segregating the proceeds from the sale of public lands in special funds. Later, they supplemented these funds from their shares of Federal surplus and provided additional aid from general revenue or from special taxes.1 They furnished aid to private colleges, and several states in the South and the new West established state-supported universities, while others, with New York leading, established free normal schools for the training of teachers.
State subsidies were furnished to county and state agricultural societies for the dissemination of information and the improvement of agriculture. Regulation of business vested with special public interest--banks, insurance companies, and railroads--was also inaugurated.2____________________