Chapter 3: Federalism

AP United States Government and Politics

Story of Sussette Kelo

Property condemned by city officials

Desire to redevelop area with pricey townhouses, malls and a large hotel

Supreme Court upheld the city’s decision-making Property can be seized for public use

Property can be seized for economic development in distressed communities

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Why “Federalism” Matters Reaction to the Kelo decision and other examples of tension and variation in policy-making Grass roots lobbying campaigns Thirty-four states tighten laws to make seizures more difficult

Half of the states have a minimum wage standard that is higher than the federal standard

Sometimes, but not always, the national government leads in making, administrating, and funding expensive public policies

Federalism Definition: system in which the national government shares power with local governments

States have a specially protected existence and authority (not merely junior partners)

The implementation and funding of federal decisions depends upon state and local government

The impact of federalism is widespread (roads, crime, civil liberties, civil rights)

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Federalism The degree and manner in which federalism has mattered has changed over time Recent highly visible attempts to scale back the national government• Devolution• Block grants

Long-standing tension between national and state governments• Slavery• Regulation of business and social welfare programs• States rights• Mandates

Governmental Structure Definition: political system with local governmental units, in addition to national ones, that can make final decisions

Examples of federal governments: Canada, India, and Germany

Examples of unitary governments: France, Great Britain, and Italy

Special protection of subnational governments in federal system is the result of Constitution of country Habits, preferences, and dispositions of citizens Distribution of political power in society

National government largely does not govern individuals directly but gets states to do so in keeping with national policy

Structure Good or Bad? Confusion about responsibility for particular functions can have dire consequences Hurricane Katrina and Rita led to fighting between federal, state, and local officials

First-responders and disaster relief workers are nongovernmental, volunteers

Some governmental agencies made delivery of aid harder

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Structure Good or Bad? Negative views: block progress and protect powerful local interests Laski: states “poisonous and parasitic”

Riker: perpetuation of racism Positive view:

Elazar: strength, flexibility, and liberty

Structure Good or Bad? Federalism makes good and bad effects possible Different political groups with different political purposes come to power in different places

Federalist No. 10: small political units dominated by single political faction

Increased political activity Most obvious effect of federalism: facilitates mobilization of political activity

Federalism lowers the cost of political organization at the local level

The Founding A bold, new plan to protect personal liberty Founders believed that neither national nor state government would have authority over the other because power derives from the people, who shift their support

New plan had now historical precedent

Tenth Amendment was added as an afterthought, to define the power of states

The Founding Elastic language in Article I: necessary and proper Precise definitions of powers politically impossible because of competing interests, such as commerce

Hence vague language – “necessary and proper”

Hamilton’s view: national supremacy because Constitution supreme law

Jefferson’s view: states’ rights with people ultimate sovereign

Debate on Meaning of Federalism

The Supreme Court speaks Hamiltonian position espoused by Marshall McCulloch v. Maryland settled two questions• Could Congress charter a national bank? (yes, because “necessary and proper”)

• Could states tax such a bank?(no, because national powers supreme)

Later battles• Federal government cannot tax state bank• Nullification doctrine let to Civil War: states void federal laws they deem in conflict with Constitution

Dual Federalism Both national and state governments supreme in their own spheres

Hence interstate versus intrastate commerce

Early product-based distinction difficult

“Original package” also unsatisfactory

State Sovereignty Mistake today to think dual federalism entirely dead Supreme Court has limited the use of the commerce clause

New life has been given to the Eleventh Amendment

Although not all recent Supreme Court decisions support greater state sovereignty

Constitutional basis of state and local government New debates have resurrected notion of state police powers

State constitutions tend to be more detailed and expansive

Many state constitutions open door to direct democracy: 1) initiative 2) referendum 3) recall

Existence of states guaranteed while local governments exist at pleasure of states

Federal-State Relations: Grants-in-Aid

Grants show how political realities modify legal authority

Began before the Constitution with “land grant colleges,” various cash grants to states

Dramatically increased in scope in the twentieth century

Were attractive for various reasons Huge surpluses in the 1880s Federal income tax was created Federal management of money and the power to print more at will “Free” money for state officials

Required broad congressional coalitions Examples: federal funds for increased public safety post-September 11

Example: Homeland Security grants and fair share formulas

Federal-State Relations: Meeting National Needs – 1960s Shift in Grants-in- Aid From what states demanded to what federal officials found important as national needs

Impact of the rise of “federal activism” Increase in federal grants to state and local government

Shift in the purposes of such money

Federal-State Relations:The Intergovernmental Lobby Hundreds of state, local officials lobby in Washington

Federal agencies have staff members that provide information, technical assistance, and financial support to state and local organizations

Purpose: to get more federal money with fewer strings

Federal-State Relations:Categorical Grants vs. Revenue Sharing

Categorical grants for specific purposes often require local matching funds

Block grants devoted to general purposes with few restricts

Revenue sharing requires no matching funds and provides freedom in how to spend Distributed by statistical formula Ended in 1986

Federal-State Relations:Categorical Grants vs. Revenue Sharing

Neither block grants nor revenue sharing achieved goal of giving states more freedom in spending Neither grew as fast as the states had hoped – categorical grants continued to grow

The federal government increasingly attached “strings” to what was supposedly unrestricted

Federal-State Relations:Categorical Grants vs. Revenue Sharing

Why block grants grow more slowly? Desire for federal control and distrust of state government

No single interest group has a vital stake in multipurpose block grants, revenue sharing

Categorical grants are a matter of life or death for various agencies

Federal-State Relations:Rivalry Among the States

Increased competition a result of increased dependency

Snowbelt (Frostbelt) versus Sunbelt state Difficulty telling where funds spend Difficulty connecting funds to growth rates

Focus on formulas and their impact Census takes monumental importance

Federal Aid and Federal Control Fear of “Washington control” and jeopardy of Tenth Amendment

Failed attempts at reversal in trends (block grants and revenue sharing)

Traditional and newer forms of federal controls on state governmental actions Conditions of aid tell a state government what it must do to obtain grant money

Mandates tell state governments what to do, and in some instances even when they do not receive grant money

Mandates Most concern civil rights and environmental protection

Administrative and financial problems often result

Federal-state disputes, fueling the friction Some mandates are not adequately funded Explaining the variation in funding

• Number high in environmental funding, low in education policy and moderate in health care

• Lower rates of spending are associated with more mandates

• Waivers are more easily obtained in some policy areas than others

Mandates Additional costs imposed on states through Federal tax and regulatory schemes Federal law exposing states to financial liability

Federal courts have fueled the growth of mandates Interpretations of the Tenth Amendment have eased flow of mandates

Court orders and prisons, school desegregation, busing, hiring practices, police brutality

Conditions of Aid Received by states voluntarily, at least in theory Financial dependence blurs the theory Civil rights generally the focus of most important conditions in the 1960s, a proliferation has continued since the 1970s• Conditions range from specific to general• The states and federal government disagree about the costs and benefits of rules

Different demands result in complex bargaining among government officials Bargains originally favored local officials Emergence of Washington’s needs over local needs

A Devolution Revolution? Efforts of the Reagan Administration

Consolidation of categorical grants into block grants Less money sent to the states, but with fewer strings States started spending more of their own money as well

Republican efforts in the 1990s Attempt to cut government spending, roll back federal regulations and shift important functions back to the states

Reform of AFDC Devolution

• An old idea led from a new direction, Congress• Spending was considered a form of constituency service

A Devolution Revolution?

Was the era of big national government over Annual federal spending per household up Federal revenues and debts are at an all time high

Spending by state and local government spending has increased as well

Large, costly federal programs remained and were not turned into block grants (Medicaid)

There have been more, not fewer government rules and regulations

A Devolution Revolution? Impact of Devolution – Where did it occur? Dramatic decrease in welfare rolls Second order devolution Third order devolution

Congressional preemption Express preemption Implied preemption

Congress and Federalism National far from wholly centralized Members of Congress still local representatives

Members of Congress represent different constituencies from same localities

Link to local political groups eroded Differences of opinion over which level of government works best