The term “bread and circuses” is used to describe low-cost entertainments which are used to distract the populace from the issues around them. It may be used in a literal sense to refer to things like benefits and other handouts along with government-sponsored entertainments, but it is also used more generally to talk about government mismanagement, and to describe the people who are distracted by such offerings. As you might imagine, the connotations of this term are generally negative.
Bread and circuses were first mentioned by the Roman poet Juvenal, who wrote during the first century, describing what he perceived as the downfall of Roman society. He felt that the Romans were softened and weakened by the Roman empire, no longer living up to their heroic reputation and history. When he derisively referred to bread and circuses, he was talking about the handouts of wheat and other foods from the Roman aristocracy to lower class Romans, and the lavish entertainments which were sponsored by the government.
The implication of the term is that people are easily distracted by entertainments, and willing to allow themselves to be weakened by bread and circuses, whether literal or figurative. The term is also meant to be critical of the government, by suggesting that instead of actually dealing with issues, the government simply hopes to distract people. A related concept is the “opium of the masses,” the drug which keeps people placated, rather than allowing them to remain alert.
As a general rule, bread and circuses are of low quality, as well as low cost, and they are readily accessible to anyone who wants them. Some people have suggested that television is the modern equivalent of Juvenal's circus, by keeping people pacified and focused on minor issues, rather than forcing them to focus on problems in their societies and with their governments.
You can sometimes use the concept of bread and circuses as a yardstick to gauge how healthy a government is. If officials seem to be spending a lot of time promoting minor social programs and talking about insignificant issues, chances are strong that they may be hoping to distract people from deeper problems. This is especially common during periods of civil unrest in response to issues like war and faltering economies.