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p. 222. Federalismlocked

  • David J. Bodenhamer


Federalism, the division of power between state and central governments, was the most novel doctrine to emerge from the Constitutional Convention. ‘Federalism’ explains how it embraced a contradiction, imperium in imperio, a sovereignty within a sovereignty. This logical inconsistency—classical theory assumed that governmental sovereignty was indivisible—could be explained only by another innovation, popular sovereignty, which vested ultimate power in the people. Federalism has proven to be a highly malleable scheme for accommodating the demands of a diverse society and a dynamic economy. What began in 1787 as a partnership of equal governments became a powerful national government two centuries later, with widespread authority to safeguard (or threaten) liberty for its citizens.

Federalism, the division of power between state and central governments, was the most novel doctrine to emerge from the Constitutional Convention. It embraced a contradiction, imperium in imperio, a sovereignty within a sovereignty. This logical inconsistency—classical theory assumed that governmental sovereignty was indivisible—could be explained only by another innovation, popular sovereignty, that vested ultimate power in the people.

Federalism has proven to be a highly malleable scheme for accommodating the demands of a diverse society and a dynamic economy. What began in 1787 as a partnership of equal governments became a powerful national government two centuries later, with widespread authority to safeguard (or threaten) liberty for its citizens. Today the morphing of federalism appears inevitable, yet nothing could be further from the truth. Its development was uncertain, and few constitutional issues have been as contentious.

Advocates of states’ rights have longed believed that power in a large and distant central government is a menace to liberty. Supporters of a strong national government have argued that authority exercised from a vigorous center advances the cause of liberty. These positions have not tracked neatly or consistently p. 23with political ideology, party affiliation, or regional identity, and both sides often have embraced a position they once rejected. During the administration of President Donald Trump, for example, liberals resurrected state sovereignty claims they spurned under the Obama presidency, whereas triumphant conservatives embraced national power they sought to block only a few months earlier. There is no easy symmetry in the history of American federalism.

The demands of an expansive economy, democratic politics, and war have shifted power from states to the central government as people sought advantage for their interests through national action. Proponents of states’ rights aided this shift by insisting on state sovereignty to maintain regimes of slavery and segregation or to exclude labor, women, and immigrants from the democratic process. Still, it would be incorrect to conclude that states are irrelevant. In education, criminal justice, public health, and public safety, state and local governments have long been important and, at times, preeminent. They also have been laboratories of democracy, with health-care reform, tax-subsidized economic development, and recognition of same-sex marriage among recent state initiatives. The story of federalism is both a narrative of national power and a counternarrative of local control.

Conflict over the relative power of national and state governments arose early. During the 1790s the United States became entangled in the imperial war between Great Britain and revolutionary France. Jeffersonian Republicans sympathized with the French overthrow of the monarchy, whereas Federalists feared the political radicalism and class conflict it unleased. The so-called Quasi-War with France (1798–1800) persuaded the Federalist-dominated Congress to pass the controversial Alien and Sedition Acts (1798) that, among other measures, punished criticism of the national government or its officials. Sedition was especially dangerous, Federalists argued, because it undermined the authority and p. 24stability of republican government. Within months, eager prosecutors convicted Republican newspaper editors (and one congressman) of sedition despite the First Amendment’s guarantees of free speech and free press.

It was an early test of federalism. Republicans viewed the acts as an infringement of freedom of speech but under what authority could they resist? Not until 1803 would the Supreme Court establish its role to declare a national law unconstitutional. Although vindication came when Republicans triumphed in the election of 1800, an appeal to states provided more immediate shelter. Led secretly by Thomas Jefferson, who was vice president, and his friend, James Madison, the Virginia and Kentucky legislatures embraced ideas that in more extreme form justified southern secession decades later.

The Kentucky and Virginia Resolutions claimed that the Constitution resulted from a compact of the states, with each state able to judge whether the central government had acted legally. States could shield citizens from enforcement of what they considered unconstitutional measures (interposition)—and, in extreme cases, they could nullify illegal acts within their borders. No other state embraced the resolutions, but the protests of 1798 and 1799 advanced three ideas—interposition, nullification, and the state compact theory of union—that would prove to be a seedbed for disunion.

The ideas embodied in the Kentucky and Virginia Resolutions did not disappear when the acts expired in 1801. Regional opposition to the War of 1812 led to the Hartford Convention, called by the Federalist remnant in New England to resist a war ruinous to their economic interests. Talk of state sovereignty, interposition, and secession was rife. The compact theory of the union and states’ rights had found a new home in the party and region that, twenty years earlier, touted the virtues of an energetic national government.

p. 25The war’s successful conclusion temporarily discredited states’ rights radicalism and marked the end of the Federalist Party. The misnamed Era of Good Feelings (1815–1828) produced a burst of enthusiasm for national action to address weaknesses revealed by the conflict. Jeffersonian Republicans, now the only party, embraced a constitutional nationalism they earlier had rejected, with Congress enacting a protective tariff and chartering a national bank they opposed in the 1790s. Their actions were pragmatic: a national emergency required national power. It was an early riff on a consistent theme in the history of American federalism.

More than Congress, however, the US Supreme Court, led by John Marshall, set the terms of federalism, with national supremacy over the states the hallmark of its jurisprudence. In 1819, the Marshall Court (1801–1835) tackled a case squarely on this issue. Maryland sought to tax all non-state chartered banks operating within its boundaries, which included the Second Bank of the United States. The branch refused to pay on grounds that states lacked authority to tax a congressionally chartered bank. The Marshall Court unanimously agreed, with its ruling in McCulloch v. Maryland still the leading decision on the power of the national government. The necessary and proper clause of Article I, Marshall wrote, allowed Congress to act: “Let the end be legitimate, let it be within the scope of the constitution, and all means which are appropriate, which are plainly adapted to that end, which are not prohibited, but consistent with the letter and spirit of the constitution, are constitutional.” The supremacy clause also shielded the branch from the state levy, Marshall held, because “the power to tax is the power to destroy.”

Other decisions expanded national power, with the Marshall Court declaring state laws unconstitutional on an average of one per year. In one case, it held that the commerce clause granted broad congressional power to regulate interstate commerce; in another, it ruled that a state could not use even its legitimate p. 26powers to promote public health and safety, so-called police powers, if they burdened interstate commerce. The contract clause, which forbade states from “impairing the obligation of contracts,” also limited state power, the justices concluded, because a national economy could not exist if states changed agreements at their discretion. For the Marshall Court, the national government represented the will of the people, and, within its delegated powers, its authority was unrivaled.

In fact, states were more active agents of political and economic change than was the national government. State governments promoted, subsidized, and steered their economies. The construction of the National Road (1811–1837), also known as the Cumberland Road, that connected the Potomac and Ohio Rivers stands as an almost solitary example before the Civil War of a major, federally funded, economic development project (or internal improvement). Such limited use of national power, however, did not quell worries about its challenge to liberty.

For the antebellum South, the tariff, a tax on imported goods, signified the danger of national power. In 1828 Congress passed a tariff to protect American manufacturing by increasing the price of competing British goods, especially textiles. Southerners protested that the measure benefited the manufacturing North at their expense. It raised the cost of finished goods and led the British to reduce their purchase of cotton from southern planters. But the South’s larger concern related to slavery. If the national government could imperil the region’s economic well-being, what was to stop it from limiting or abolishing slavery?

Opposition to the tariff of 1828 was led by South Carolina senator and soon-to-be vice president John C. Calhoun, who secretly wrote a 35,000-word Exposition and Protest that gave new force to the doctrines of interposition and nullification. The tariff’s only legitimate purpose was to generate revenue, he contended, not to protect American industries; Congress also could not favor p. 27manufacturing over agriculture. Under these conditions, a state, acting in a popularly elected convention, retained power to “veto” any unconstitutional measure of the central government. It was a provocative argument because Calhoun rested his case not solely on states’ rights but on popular sovereignty as well. The states were not acting as states alone but as agents of the people.

Calhoun’s claim reminds us of how often Americans appealed to the revolutionary tradition of popular sovereignty when dissenting from the actions of their government. The Virginia and Kentucky Resolutions, the Hartford Convention, and the Nullification Crisis raised questions about how the people created the nation: collectively as states or as an undifferentiated national body? For the slaveholding states, the answer became progressively tilted toward an extreme version of state sovereignty in which each state could nullify what it judged to be an illegitimate national law within its boundaries. By implication, each state also could decide whether to remain in the union.

The Nullification Crisis ended after President Andrew Jackson threatened to use federal troops to enforce national power. (No other state was willing to stand with South Carolina.) Jackson was characteristically blunt: “The Constitution … forms a government not a league … To say that any State may at pleasure secede from the Union is to say that the United States is not a nation.” This position was unambiguous, but it also was limited. Jackson expressed a common view that the Constitution established a permanent union but the national government was limited to its delegated powers, strictly construed. It was a stance well suited to the individualistic, market-oriented American society of the 1830s.

The post-Marshall Supreme Court, led by Jacksonian Chief Justice Roger B. Taney (1836–1864), was much friendlier to state rights. A new constitutional doctrine, dual federalism, replaced Marshall’s constitutional nationalism: each government, state and p. 28p. 29national, was supreme in its own sphere, with a bright line between them. The US Supreme Court was an impartial referee, ensuring that state and central governments did not intrude on the other’s authority.

2. In response to high import duties in 1828 and 1832, South Carolina embraced a doctrine of nullification in which the state claimed the right to block national laws that harmed its interests. It was a severe test of federalism and national supremacy and raised serious concerns about whether the nation could survive, as a 1832 broadside from Philadelphia demonstrates. President Andrew Jackson threatened to use military force to uphold the Union, and a compromise tariff in 1833 defused the crisis, which scholars have called a prelude to the Civil War that followed three decades later.

This pragmatic rule worked reasonably well in economic matters; the nation’s business was too dynamic and diverse for a small central bureaucracy to monitor. On slavery, however, dual federalism was increasingly at odds with public opinion in northern and western states. The “peculiar institution” rested on a denial of liberty and fostered a class society that conflicted sharply with American values of freedom and equality. When the national mood turned against the proslavery position in the late 1850s, slaveholders again picked up the banner of extreme states’ rights and nullification. The issue was never about money and power alone. Without the social control provided by slavery, southerners feared their way of life would end in a cataclysm of black insurrection.

Dual sovereignty could not reconcile slavery and freedom, even though the Taney Court tried. Forced to choose, the fractured justices settled on state sovereignty. Dred Scott v. Sanford (1857) held that national and state citizenship were separate and distinct; blacks, who were not citizens, had no rights the federal government must protect. Chief Justice Taney went further by denying federal authority over slavery. It was a stance an increasingly anti-slavery northern public would not accept.

Northern victory in the Civil War settled the constitutional crisis by repudiating state sovereignty and a right of secession. It also redefined the basis and terms of the national union. In his first inaugural address, President Abraham Lincoln declared that common experiences, a common culture, and “the mystic chords of memory” unified Americans, who were a national people before the Revolution. The Constitution—created by the people, not the states, he argued—was written “to form a more perfect Union,” p. 30words that Lincoln italicized in emphasis. The United States was a singular noun, not a plural one.

Here was a different understanding of federalism: the national government, exercising the people’s authority, represented the nation completely; its power was full and unrivaled. Reconstruction policies sought to make this new meaning part of the nation’s fundamental law. Three amendments to the Constitution aimed to improve the union by realizing the promise of equality before the law. The Thirteenth Amendment abolished slavery, the Fourteenth Amendment defined citizenship, and the Fifteenth Amendment expanded political participation to freedmen. The Fourteenth Amendment was especially important. It made every person born in the United States both a citizen of their state and a citizen of the nation, with “equal protection of the laws” and “due process of law” guaranteed for all citizens. Previously, Americans were independently citizens of their states and of the United States, with most people looking to state constitutions for the protection of their rights. Had this understanding continued, newly freed African Americans would be vulnerable to abuse, as in fact occurred in 1866 when reconstituted southern states passed “black codes” to deprive ex-slaves of most rights.

Although the Fourteenth Amendment made the national government responsible for protecting the rights of citizens, few people believed that the amendment changed the system of dual sovereignty. Even Congress intended for it to restore federalism, not restructure it. Reconstruction extended the meaning of liberty but it did not lessen the traditional concern about power. Its congressional architects trusted that access to the ballot by blacks would result in state governments protective of their rights, with the federal government intervening only if states failed to do so.

It was a misplaced assumption: with few exceptions, the Court accepted local standards and state differences in the rights of citizens. When butchers in New Orleans claimed that a law p. 31requiring them to use a central slaughterhouse violated their Fourteenth Amendment right to work freely in their occupation, the justices drew a sharp distinction between state rights and national rights. States could regulate the conditions of employment as part of their traditional power to protect the health and welfare of their citizens. The Fourteenth Amendment protected only a limited set of national rights (Slaughterhouse Cases, 1873).

Subsequent decisions narrowed the list of protected national rights. In 1884, the Court affirmed the pre–Civil War understanding that the Bill of Rights did not apply to the state governments, effectively limiting the rights Congress could protect against state action. The year before the justices held that the Fourteenth Amendment protected individuals against the actions of state government, not against private discrimination. It was a short step to Plessy v. Ferguson (1896), which made “separate but equal” treatment permissible, thereby legitimizing widespread racial segregation.

Dual federalism was acceptable for social regulation but it was too messy for large-scale industrialization. The Fourteenth Amendment took on new life as a check on the power of states to govern economic activity. The Supreme Court defined corporations as persons in 1886, which provided them protection against arbitrary state action under the amendment’s due process clause. The same year it voided an Illinois law fixing railroad rates as an interference with congressional power over interstate commerce. Congress responded by creating the Interstate Commerce Commission (1887), a regulatory body charged with ensuring reasonable rates. The national government, first by judicial decision and then by statute, had begun to deprive states of authority to regulate the economy.

This new order brought its own problems. Corporate corruption convinced citizens that monopolies posed a greater threat to p. 32liberty than did government. This belief changed the debate about federalism. No single state or even groups of states could regulate the new industrial giants, so the only option was to increase national authority to control private power. The Sixteenth Amendment (1913), which authorized a national income tax, made this change possible. With the revenues to create a strong national bureaucracy, the calculus of power began to shift.

The twentieth century expanded national power to respond to economic crises and threats to national security. World War I brought an unprecedented use of centralized power, which served as precedent for the New Deal’s response to the Great Depression. It also raised an important constitutional question. Did the national government have the power to interfere in the economy to whatever extent required to stave off financial collapse? At first the Court balked at abandoning traditional restraints but soon the justices retreated. Economic crisis left the Court little choice but to allow national power to save capitalism.

After the mid-1930s, few restraints existed on the ability of the national government to regulate the economy. Federal power under the commerce clause reached virtually all economic activity, a result that echoed Marshall’s constitutional nationalism a century earlier. The Court also declared that Congress, not the judiciary, had the final say on whether the regulation was reasonable. Only the voters could check its power.

Soon a wide array of laws and regulations defined activities as within the “stream of commerce” and therefore subject to national authority. In the Civil Rights Act of 1964, for example, Congress relied on the commerce clause rather than the equal protection clause of the Fourteenth Amendment to ban discrimination in public accommodations. Not until 1995 did the Court limit this blanket authority in state-federal conflicts by deciding that regulation of handguns on school property was too far removed from commerce to limit the states’ traditional police powers.

p. 33Since the late 1980s the Supreme Court has been more assertive in seeking to rebalance federalism by citing the Tenth Amendment, for example, when it declared that Congress could not command state officers to enforce the provisions of a federal gun control law. Although limiting congressional power, such decisions do not auger a return to dual federalism. It is too impractical. States have not clamored for change because they now rely on federal funds to solve increasingly complex problems. Education, crime, economic development, immigration, public health, and a host of other issues have local expressions but few people argue seriously that any state could solve them alone. Only the national government has authority and resources to address issues that transcend state boundaries.

The result is cooperative federalism, with the national and state governments working in partnership to solve problems in a complex, highly diverse society. This version of divided government may not have been foreseen by the framers, but it would not have surprised them. In Federalist 34, Alexander Hamilton predicted that the centralizing impact of war and economic crisis would restrict the power of the states to a “very narrow compass” while the demand for national solutions would prove “altogether unlimited.”

In another area, individual liberties, the constitutional tide also ran against the states. Beginning in 1896 the Supreme Court extended the due process protection of the Fourteenth Amendment as a restriction on state action by redefining due process to mean a fair result, not simply fair procedures. Known as substantive due process, this concept made judges, not legislatures, the guardian of rights, even though federal courts used it initially to declare state regulation of corporate monopolies unreasonable. By the mid-1920s, however, the Supreme Court included the First Amendment rights of speech and press as a fundamental right protected by the due process clause of the Fourteenth Amendment. Soon rights of the accused were p. 34included, as case after case revealed the states’ too-casual protection for individual liberties, especially for African Americans, labor unions, and political dissenters.

This nationalization of the Bill of Rights became almost complete by the end of the 1960s, as the Warren Court (1953–1969) incorporated many rights into the due process clause. Such a sharp departure from traditional American federalism spurred politicians to promise to restore state control, but later courts only trimmed, not reversed, the controversial decisions. Too many instances of injustice had caused citizens to look for protection from the national government rather than from their states.

States’ rights has lost much of its heft as a constitutional doctrine. A succession of southern governors sought to resurrect it during the 1950s and early 1960s to defeat desegregation, but their use of it was little more than political theater. More recently, state attorneys general tried to block national policies on health care and immigration, with little success. States are not powerless, however. Equal representation in the Senate allows states to influence, impede, and, at times, frustrate national policies, as southern senators did when they filibustered civil rights measures. These tactics were enlisted in an unworthy cause, but their use signaled an important shift in the practice of federalism. It finally had become a matter of ordinary politics.

Ultimately, federalism changed not because of fundamental shifts in doctrine but because the nation changed. National power grew in response to democratic choices and global challenges. Citizens demanded a national response to problems of the elderly, the poor, and the handicapped; they marched for national enforcement of civil rights laws; they lobbied for consumer and environmental protections; and they supported national science, education, and industrial policies vigorous enough to protect American leadership globally. Significantly, advocates for an increased national role have come from both major parties.

p. 35Even as national power grows, states continue to have meaningful roles in a wide array of matters affecting the health and welfare of their citizens. Federal courts will be sensitive to the policies and practices of the states in determining when a national consensus exists to justify a reinterpretation of law. Congress cannot ignore the wishes of states because its members reflect state and local constituencies. Americans will insist on this result because they are uncomfortable as a matter of history and preference with government that lacks a local face.

Questions remain about whether national power is too great and whether it is time to restore authority to the states. This debate is one constant in the changing meaning of federalism. Americans continue to search for the right balance of power and liberty. The revolutionary mantra of divided power remains central to this search, as does the framers’ bet that power vested in central government, with proper limits, furthers the growth of liberty. It is this original gamble that continues to give life to federalism itself.