The stone layer, not the ground under it
Subbase and subgrade get used interchangeably around a job site and they are not the same thing. Subgrade is the native soil itself, cut and compacted where it sits. Subbase is what gets brought in and placed on top of that soil: crushed stone, spread in lifts and compacted as it comes up to the height the forms call for. One is what was already there. The other is added. A slab poured with good subbase over poor subgrade can still fail if the ground underneath was never dealt with, which is a big part of why the two get talked about together so often.
Why it drains instead of holding water
Red clay, common across this part of Virginia, holds water and swells when it gets wet. Left alone under a slab, that movement telegraphs straight up through the concrete. Crushed stone breaks that connection. The gaps between the stone particles give water somewhere to go instead of pooling against the bottom of the slab, so the ground under the concrete stays more stable through a wet season and a freeze than raw clay would on its own. Firm bearing and drainage, in one layer, is the job a subbase does.
What happens when it is skipped or built thin
A slab poured with no subbase, or with stone that never got compacted properly, is sitting on whatever the ground gives it that day. Where the base settles or a void opens up underneath, the concrete has to span the gap on its own, and concrete is not built to do that. It cracks and a corner drops. That is the base problem behind most of the failed floors and driveways that get a service call, and it is why the compacted stone layer gets as much attention on site as the pour itself.