Constitutional Federalism Initiative

The U.S. Constitution creates our federal system of government by separating government powers and responsibilities between the national and state governments. James Madison described this system as a compound republic that combines elements of unitary and confederal political systems. The consequence of dividing power between two distinct governments (national and state) and then subdividing those powers between branches of government, Madison claimed, would provide a double security protecting the people’s liberties.

Though unique in many ways, America’s federal system has historical roots in the Articles of Confederation that governed America through the Revolutionary War, the colonial period when Britain largely neglected the colonies and allowed them to self-govern, and the Mayflower Compact that created a limited government accountable to the people.

America’s federal system is dynamic. While the U.S. Constitution grants the national government particular powers and the state governments general powers, the actual mix and interactions between the national and states government is quite flexible. “The question of the relation of the States to the federal government,” future U.S. President Woodrow Wilson wrote in 1908, “is the cardinal question of our constitutional system. At every turn of our national development we have been brought face to face with it, and no definition either of statesmen or of judges has ever quieted or decided it. It cannot, indeed, be settled by the opinion of any one generation, because it is a question of growth, and every successive stage of our political and economic development gives it a new aspect, makes it a new question.” A century later, President Wilson’s observation still rings true.

Since its inception at the Constitutional Convention in 1787, America’s federal system of government has taken many forms. In the last century, significant powers were centralized in the national government based on a belief that experts should decide policy, good government could be scaled, and centralized authority would create a national democratic union and national unity. Regarding our system of government today, Senator Daniel Patrick Moynihan wrote, “There is no significant aspect of national life about which there is not likely to be a rather significant national policy. It may be a hidden policy. … But it is policy withal.” In other words, the national government governs almost without borders.

Yet, after nearly a century of growing nationalization, the justification for that centralization is suspect. The policy decisions resulting from the Covid epidemic, declining K-12 students’ test scores, almost insurmountable obstructions to growth, political polarization, and rising national debt are strong indicators of the inadequacies of nationalization.

James Madison perspicuously warned that placing too much responsibility on the national government would shift power from Congress to the president. If asked to do too much, Madison reasoned, a deliberative-body like Congress will become deadlocked and must defer decision-making authority to the executive which was designed to act with dispatch. The result is what we see today, each party advances its partisan preferences as far as possible when it controls the executive via executive orders and emergency measures.

National decision making has also placed us in a growing debt crisis. In 2008, Alice Rivlin, Director of the Office of Management and Budget during the Clinton Administration, wrote, “The grim outlook for the federal budget makes it inevitable that in the near future strains between the federal government and the states over funding domestic programs will escalate into a crisis. . . Federal decisionmakers will be forced to choose among extremely unpopular options—raising taxes, reneging on promises to the elderly, and drastic cuts in other spending, including money for state and local governments. . . Responding adequately to these widely felt needs will take constant attention to improving the functioning of our federal system.” The solution, Director Rivlin recognized, will not come from more centralization but a restoration of a functioning federalism.

In 1998, the Urban Institute identified these problems and warned of their potential to deprive Americans of their most basic commitment and identity, that of self-government. “Stripped down to its essentials, the American political process expresses a faith in self-government. It is the democratic faith that through argument, deliberation, and persuasion people are, in the long run, capable of discovering and promoting their common good. . . If one rejects democratic self-rule through public debate and deliberation, the only alternatives are rule based on the will of the most powerful, or rule based on deference to experts, insiders, whoever is seen as specially anointed to tell other people what to do.” Self-government, the Urban Institute proclaimed, is the government we deserve.

A century of centralization has brought us a dysfunctional Congress, a consuming debt that constrains choice, polarization, and a growing public sense of powerlessness and alienation when the opposing party’s president holds office.

In short, the compound republic created by the Constitution has slowly been displaced by national rule that entangles the national and state governments in labyrinthian jumbles that impair good governance and undermine American’s fundamental faith in, and ability to exercise, self-government.

Maintaining America’s compound republic to secure self-government was always going to require fighting against natural forces. Federalism is a compromise between contrasting desires to be big enough to deter outside aggressors and achieve the benefits of a large common market versus the desire to preserve local autonomy and choice. Sustaining that tension will be difficult, political scientist Martin Diamond observed, because the “natural tendency of any political community, whether large or small, is to completeness, to the perfection of its autonomy.” Federalism, he continues, is the effort to deliberately modify that tendency.

A similar thought was expressed by Alexis de Tocqueville nearly 150 years earlier when he wrote, “I think that in the dawning centuries of democracy individual independence and local liberties will be the products of art. Centralized government will be the natural thing.”

After a century of centralization we should ask whether science has led us here or if we have used science to justify the natural thing?

The growing problems, dysfunction, and lack of solutions along our current path indicate a need to rethink our choices. Perhaps some direction forward may be found in the simple phrase that appears in many state constitutions: "A frequent recurrence to fundamental principles is absolutely necessary to preserve the blessings of liberty." We think it time to recur to federalism, to consider it not as a pragmatic political compromise of 1787, but as a discovered, fundamental principle of good governance.

The federal balance between the national and state governments has changed repeatedly over American history. It is changing again now. Whether states will participating in shaping that federal system or zre shaped by it depends on how well state leaders understand the system, defend their institutions, and govern.