Federalism
The Logic of American Politics
Chapter Three
American-Style Federalism
• In a federal system, authority is
divided between two or more distinct
levels of government.
• In the United States the division is
between the national (federal)
government and the states.
American-Style Federalism
• Federalism is a hybrid arrangement.
– Mixes elements of a confederation (lower level has
real power) and a unitary government (national level
monopolizes constitutional authority).
• Before adopting a federal system in the
Constitution the nation had experienced both of
these alternatives.
– Monarchy/parliament – unitary.
– Articles of Confederation – confederation.
American-Style Federalism
• Worldwide, unitary governments are far more
common.
– Examples: United Kingdom and France.
– Typically, the central government establishes national
policies and raises and distributes funds to the local units
to carry them out.
• Lower-level units function primarily as the
administrative apparatus of the national
government.
Qualifications of Federal Systems
•
A government must have constitutional relations
across levels, interactions that satisfy three
general conditions:
1. The same people and territory are included in
both levels of government.
2. The nation’s constitution protects units at
each level of government from encroachment
by the other units.
3. Each unit is in a position to exert some
leverage over the other.
Qualifications of Federal Systems
• The second condition, independence, sets
the stage for the third condition, mutual
influence.
• Independence was the missing ingredient
that made the national government
impotent under the Articles of
Confederation.
Qualifications of Federal Systems
• Note also that local governments are not a
separate level of government.
• They are established by the state and do
not exercise independent, constitutional
authority.
• State law establishes their responsibilities
and the extent of their discretion over
policies.
Types of Federalism
• Two distinct forms of American
federalism have been identified.
– Dual federalism.
– Shared federalism.
Dual Federalism
• The simplest possible arrangement.
• This type of federalism leaves the states and
the national government presiding over
mutually exclusive “spheres of sovereignty.”
• The nation, however, has never divided
authority so neatly.
Dual Federalism
• From the early days of quite limited responsibility
for the national government, nationalization has
shifted authority to the national side and away
from state governments.
• Today the national government has a hand in
almost all policies that “concern the lives” of the
citizenry.
• Dual federalism no longer describes that nature of
federal-state relations.
Shared Federalism
• The second and more accurate conception
of federalism is called shared (or
“cooperative”) federalism.
• It recognizes that the national and state
governments jointly supply services to the
citizenry.
• Over the years progressive nationalization
has moved American federalism from
mostly dual to mostly shared.
Shared Federalism
• Often the scope and complexity of
modern problems mandate a joint,
cooperative strategy across states and
levels of government.
Shared Federalism
• Critics of nationalization argue that the
federal government has so intruded into the
traditional responsibilities of states and
local communities that even “shared”
federalism is a misnomer.
• But if there have always been critics, how
did we get to this point?
Shared Federalism
• Why have states’ rights advocates had difficulty
partitioning federal and state responsibilities?
• As national politicians sought to expand their
authority over the years, they discovered that the
wall between the federal government and the
states was not impregnable.
– The Constitution leaves ample room for a variety of
federal-state relations.
• Moreover, when nationalization of public policy
proceeded, it rarely triggered a constitutional
crisis.
Shared Federalism
• But the question of
whether or not the
federal government
actually assumed
responsibility for a
specific policy
remained (and still
is) a political
decision.
The Constitution and Federalism
• The greatest victory of states’ righters
during the Constitutional Convention
was the creation of a Senate whose
members were to be selected by the
state legislatures.
• Thus senators are beholden to the state
legislators.
Constitutional Provisions Governing
Federalism
• The ratification of the Constitution was by
state conventions that directly represented
the people, not by the state governments
themselves.
• Thus the people created the government, not
the states.
• Language governing the relationship of the
national government to the states runs
throughout the Constitution. But the end
result was a system open to nationalizing
forces.
The Supremacy Clause
• “This Constitution, and the Laws of the
United States which shall be made in
Pursuance thereof [that is, in keeping with
the principles of the Constitution] … shall
be the supreme law of the land.”
The Supremacy Clause
• The provision of the Constitution with the
most profound implication for modern
American federalism is the so-called
supremacy clause in Article IV.
– This clause does not give the federal
government free license.
– Framed to avoid impasses over jurisdiction
rather than to cede to the national government
broad, preemptive authority over the states.
The Powers of Congress
• Article I, Section 8 lists powers of Congress
(enumerated powers).
• These powers are important to federalism
because they create jurisdictional
boundaries between the states and the
national government.
The Powers of Congress
• Some powers are broadly stated and thus
helped open up state policy to national
intervention.
– Example: the commerce clause.
• In addition, the elastic clause (necessary and
proper clause) also eventually undermined
the restrictive purpose of the enumerated
powers.
The Tenth Amendment
• Given the fear of tyranny as articulated by the
Antifederalists, it is not surprising that Madison
had to promise the addition of a Bill of Rights as
an incentive for ratification.
• Many members of the first Congress wanted
protections for the states as well as for individual
citizens.
• The Tenth Amendment reserves to the states (or
the people) all powers not directly given to the
national government.
The Tenth Amendment
• The Tenth Amendment offers the most
explicit endorsement of federalism to be
found in the Constitution.
• Yet despite its plain language, the Tenth
Amendment has failed to play a major role
in fending off national authority.
• Why?
• The powerful combination of the supremacy
and the elastic clauses.
Interpreting the Constitution’s
Provisions
• Sweeping language with which the
Constitution variously endorses national
power and states’ rights has given
politicians easy openings to interpret the
Constitution according to their own political
objectives.
• The “wall” between the federal government
and the states is not as impregnable as the
Framers had supposed.
Supreme Court as Federal/State
Arbitrator
• The Framers
envisioned the
Supreme Court as the
referee of disputes
between the national
and state governments.
– When resolved created
powerful precedents.
– Allowed national
policy to develop free
of state prerogatives.
• McCulloch v. Maryland
(1819)
– Protected the national
government from actions of
the state.
• Gibbons v. Ogden (1824)
– Only Congress possesses
authority to regulate
commerce.
• Garcia v. San Antonio
Metro Transit Authority
(1985)
– Federal wage hours applied
to state and local
employees.
The Logic of Nationalization
• How does policy become nationalized?
• Generally, two scenarios:
– Realities of collective action (problem
solving).
– Purely political considerations (i.e.,
opportunities for political advantage).
The Logic of Nationalization
• The road-building game illustrates an
important lesson in federalism: a state’s
jurisdiction over public goods that fall
within its borders offers real advantages:
efficiency and responsiveness.
• But once the public good encompasses the
larger community, the logic for local control
disappears.
The Paths to Nationalization
• Throughout the first half of the nineteenth
century, America remained a nation of
segmented communities that did not
require much coordination of commercial
endeavors.
The Paths to Nationalization
• Changes in the United States:
–
–
–
–
Growth
Industrialization
Urbanization
Development of national transportation and
communications systems
• The nation’s desire for public goods that could
not be met by local communities and states
increased.
The Paths to Nationalization
• There are certain things that a local or state
government has difficulty providing.
• Food safety standards and commercial
regulation are examples.
• Interstate Commerce Act of 1887:
– Regulation of railroads as farmers protested rate
discrimination and high charges.
– Antimonopoly laws.
The Paths to Nationalization
• The nationalization of public policy grew out of the
requirements of collective action.
• First, Americans have at times collectively decided
to adopt policies of such magnitude and scope that
they outstripped the resources of the state.
– Roosevelt’s New Deal.
– Johnson’s War on Poverty/Great Society.
• Second, states have solicited federal intervention
when they cannot solve their problems by working
together individually.
• Third, it is sometimes easier for the majority to work
through Washington, D.C., than through the states.
More efficient. Civil rights is a good example.
Historic Transfers of Policy to
Washington
• Roosevelt’s New Deal
(1930s).
• Johnson’s Great Society
(1960s).
• Broadened the scope of
federal responsibilities.
• Were accompanied by
large national majorities to
Congress from the
president’s party. A
mandate for new
collective goods.
The New Deal
• Roosevelt’s New Deal was
a comprehensive set of
economic regulations and
relief programs (massive in
size and scope) intended to
fight the Great Depression.
• To justify its unprecedented
intervention in the
economy, FDR invoked the
commerce clause.
The Great Society
• Elected in 1964, Lyndon Johnson
and his Democratic Congress
launched a War on Poverty -- part
of a Great Society agenda.
• Passed more than 100 new
categorical grant programs.
• Spent over $5 billion 1964-65.
• Grants supplemented state
programs/national goals.
• Traditional state and local
responsibilities became federal
ones.
Nationalization: The Solution to States’
Collective Dilemmas
• The kinds of collective action
dilemmas that prompt states to ask
Washington for help often fall into
one of three categories:
1. Coordination problems.
2. Reneging and shirking.
3. Cutthroat competition.
Coordination Problems
• A nation composed of fifty states is bound to face
coordination problems.
• Example of driver’s license laws:
– Lobby to standardization for interstate truckers -- what
led to this federal intervention?
– Creation of bureau within DOT to centralize records of
traffic violations.
– Easier to create centralized record keeping than to
require each state to update its records with those of
every other state.
Coordination Problems
• Another example:
– Need to deal with potential blackouts like the one in
August 2003.
– Congress: national regulatory policy of electrical
transmission.
– Concern of farmers: surrendering authority (conformity
costs) for one agreed purpose might lead the new
federal authority to undertake less-desirable policies.
– Regulatory coordination under FERC would allow
cheap local electricity to chase market prices and drive
up local costs.
Reneging and Shirking
• States may always honor their commitments to
their sister states.
• The Constitution and national laws solve many of
these dilemmas by authorizing the federal
government to take direct action raising resources
and administering policy.
• Example: polluted air/water. Without enforcement
states continue to pollute.
Cutthroat Competition
• Under the Articles of Confederation each state was
free to conduct its own international trade policy.
– Foreign governments and merchants would exploit the
competition among the states for their own ends.
– Classic prisoner’s dilemma -- why?
– Negotiating from a united front the best strategy, but
states underbid each other or engaged in cutthroat
competition.
Cutthroat Competition
• At various times cutthroat competition has
prompted state officials to lobby Washington to
prevent bidding wars.
• Examples: minimum wage standards,
environmental regulation.
• Competition can also emerge as states bid against
each other for economic reasons – getting
companies to relocate to their state by providing
tax breaks or special services.
• States spend as much as $40 billion annually to
lure and retain large employers to their states.
The Political Logic of
Nationalization
• Sometimes those promoting a policy find that it is
in their interest to shift their focus from the states
to the national government. Why?
– Difficult to lobby/persuade fifty separate states.
– More efficient method – a single federal law
can change policy in all fifty states at once.
– National government may be more receptive.
– Can you think of some recent examples?
The Political Logic of
Nationalization
• Sometimes the reverse political process
occurs, as groups that lose at the national
level see smaller victories in those states
where they enjoy majority support.
• Example: social conservatives on the issues
of abortion rights and school prayer.
The Political Logic of
Nationalization
• As James Madison emphasized in Federalist No.
10, states and the national government combined
the citizenry’s preferences into different
groupings.
• The result: the two levels of government may
adopt different, even opposite, policies to address
the same problem.
• Moreover, national majorities have the
institutional resources to nationalize many policy
questions that once were the exclusive domain of
the states.
Transformation of the Senate
• In the nineteenth century the equal representation
of states regardless of population, combined with
the selection of senators by the state legislatures,
gave the Senate the motive and means to defend
state prerogatives.
• In 1913 public pressure forced Congress and state
legislatures to ratify the Seventeenth Amendment - complaints that individuals were buying Senate
seats with bribes to legislators.
• Consequence: diminishment of one of the props of
federalism.
Modern Federalism
• National government’s primacy in
setting domestic policy is secure.
– Recent Supreme Court decisions
beginning to fence in the federal
government’s ability to dictate policy.
– Gains have been modest.
– Easily circumvented by an alternative
strategy of financial inducements.
Preemption Legislation
• Federal laws that assert the national government’s
prerogative to control public policy in a field.
– Relatively little preemption prior to the New Deal.
Afterwards, much more.
– Owes its existence to the supremacy clause.
• On balance, federal government has not usurped
states’ jurisdictions so much as it has joined with
the states in formulating policy.
– Result: shared federalism.
• How does the federal government induce
cooperation from the constitutionally independent
states?
– Carrots and sticks.
The Carrot: Federal Grants
to the States
• During the last fifty years federal grants-in-aid
became an important part of intergovernmental
relations.
• Few grants prior to New Deal.
• All of these programs enlist categorical grants, in
which federal dollars are tied to particular
programs or categories of spending.
• These grants are inducements to states to carry out
particular programs, but they also allow the
national government to define these state
programs.
The Carrot: Federal Grants
to the States
• Another alternative to categorical grants:
block grants.
• Like categorical grants, funds are
appropriated to achieve a particular policy
goal with specific administrative
procedures.
– Policy targets are only generally stated.
– Fewer strings are attached.
The Stick: Unfunded Mandates
• Since the 1960s the federal government has relied
increasingly on rules to pursue policy objectives.
• States are required to administer policies they
might object to, and they may even be asked to
pay for the administration of the policies.
• Examples:
– No Child Left Behind Act.
– Help America Vote Act.
Methods Used to Prescribe State
Policy
•
The national government uses four basic
methods to prescribe state policy and
supervise its administration.
1.
2.
3.
4.
Cross-cutting requirements.
Crossover sanctions.
Direct orders.
Partial preemption.
Cross-cutting Requirements
•
•
•
Statutes that apply certain rules and
guidelines to a broad array of federally
subsidized state programs.
Example: failure of any state to follow
federal guidelines that prohibit
discrimination can result in the prosecution
of state officials as well as loss of grants.
Has been used to enforce civil rights laws.
Crossover Sanctions
• Stipulations that to remain eligible for full
federal funding for one program a state
must adhere to the guidelines of an
unrelated program.
• Example: Congress’s stipulation that federal
highway funds be tied to state adoption of a
minimum drinking age of twenty-one.
• Example: bill restricting sale of soft drinks
on school grounds tied to school aid funds.
Direct Orders
• Requirements that can be enforced by
legal and civil penalties.
• Example: the Clean Water Act.
Partial Preemption
• Certain federal laws allow the states to administer
joint federal-state programs so long as they conform
to federal guidelines.
• If an agency fails to follow the instructions of the
federal agencies, the state might lose control of the
program.
– Example: state air pollution policies.
• Public law and the EPA set minimally acceptable
standards, but enforcement of these standards rests
mostly with state agencies.
Trends in Federal Regulation of
States
• Federal grants plentiful before the 1970s;
few regulatory policies in place.
• Since the 1970s the more coercive forms of
regulation, direct orders and partial
preemption, have been favored.
• Federal regulation of states concentrated in
two areas: environment and civil rights.
Trends in Federal Regulation of
States
• Unfunded Mandates Reform Act.
– Required that new federal laws pay for the
programs and regulations they imposed on the
states.
• The practice of unfunded mandates and
preemptive legislation has continued.
Federalism: A Byproduct of
National Policy
• Federal-state relations are dynamic and
have been dramatically transformed during
the twentieth century.
• Nationalization of public policy is not based
on a grand design planned by the Framers
but is rather the product of:
– Problem solving and constituency service: the
interplay of political interests.
• Likely to continue in this form.