How the Paradox of American Federalism Is Leading to Big Government

The central state and the states themselves operate on very different theories (Judicial Learning Center)

“Laboratories of democracy” is the expression coined by U.S. Supreme Court Justice Louis Brandeis, who served from 1916 to 1939. Justice Brandeis explains federalism as the sharing of power between the federal government and the individual state governments in a way that: “a state may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country.”

United States federalism, as designed by the Founding Fathers, is a hierarchical system of government under which two levels of government exercise a specified range of control over the same geographic area. The Tenth Amendment of the U.S. Constitution provides that “all powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

It is well understood that federalism is a compound model of government featuring a division of powers. Not well understood, however, is that U.S. federalism organizes its two major divisions of government – the central state and the states- using different theories of power. This is a point developed by Gary Gerstle in his book Liberty and Coercion.

The central state, as emphasized by the Bill of Rights, is organized along the classical values of liberal theory in which citizens have inalienable rights that no government can take away. The states, on the other hand, derive their power from a different political theory emphasizing the people’s welfare (salus populi). This principle, in contrast to liberal theory, calls for society to be meticulously regulated by government under the theory that the people’s wellbeing trumps individual rights. This is the American governmental paradox of liberty within coercion.

As Americans, we have learned to live inside this increasingly complex puzzle of individual liberties encased in coercion. Indeed, in no other industrialized country has the central government been historically required to fight for its legitimacy as fiercely as in the United States. This struggle showcases how our personal attitudes towards liberty and coercion cohabit our thinking as a thorny paradox.  We are a republic that seeks to limit central power, but sanction state power.

The Founding Father’s antigovernment hostility was almost exclusively directed at a central government that they saw as an institution far from, and external to the people.  State governments, on the other hand, were indistinguishable from the people. They were the people. Thus, state governments, in the Founding Father’s vision, should have the greatest influence over our daily lives.

By constitutional design, the federal government was authorized to assume only those duties expressly given to it; all other enumerated tasks were left to the states.  But the history of American government shows an unrelenting desire to expand the capacity and power of the federal government much beyond its constitutionally imposed limits.

The Leviathan that is the federal government today coalesced with a central government power grab during, and following World War II that enfeebled the power of the states. Prior to the war, the states accounted for nearly 60 percent of total government revenues in the U.S.  The mass taxation system established by the federal government during the war, inversed the money power equation. By the end of the war, the share of government revenues controlled by the federal government had increased to 70 percent of total government revenues.

Today, the federal government uses this increased financial power to impose uniformity on conventional local issues such as driving speeds or drinking ages.  It does so disregarding that, for example, Alaska and Florida are very different states with different needs, populations, and values. A federal law that makes sense for Florida may be absurd for Alaska.

But most importantly the federal encroachment on the states’ power dominion is accomplished by adopting the different theory of power reserved for the states. That is, the federal government engages the states’ political theory of the people’s welfare that calls for society to be meticulously regulated by government.

In this process we lose our laboratories of democracy and our foundational liberal theory of power where citizens have inalienable rights that no government can take away. We resolve the paradox; we lose liberty, and we are left only with coercion.  

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