This paper continues a long-standing process, expressed in current practices of reauthorizing federal legislation every 5 years, of examining the rationale for federal involvement in occupational (vocational) education. Past discussions of this issue have come to a broad set of conclusions that the federal government should fund what states cannot fund on their own, including efforts to improve the quality of occupational education, to enhance equity, and to conduct the kind of research and demonstration projects that are more efficiently carried out at the federal level. Section I of the paper outlines the historical role of the federal government in occupational education and details two important changes in the continuing arguments--the Education Consensus around the need for a better-prepared labor force and the Institutional Transformation of high school and postsecondary occupational education since the early part of the 20th Century. Section II outlines why certain changes implied by the Education Consensus are unlikely to be undertaken by states and why there remains a justification for a federal role in implementing this consensus. Section III presents an explicit argument for the need and role constraints for federal policy in occupational education, especially given limited funding and the current government attitude not to intrude on the prerogatives of the states. (Contains 21 references.) (KC)