Federalism made the US possible. Now, it may be a threat

Donald F Kettl

THE WASHINGTON POST (AP) – In the aftermath of the American Revolution, one thing was clear to our country’s leaders: If a stronger union could not be negotiated, the United States would soon fall apart. Without one, George Washington warned in 1787, “I do not conceive we can exist long as a union.” The young nation faced a formidable task.

The states didn’t trust one another, not least because many of them had little in common culturally, ethnographically or politically. New Englanders’ Puritan ancestors had devised their institutions to prevent their greatest fear: the formation of an aristocracy. Yet the Chesapeake Country was run by a landed, slaveholding gentry, complete with English-style manor homes with names like Monticello and Mount Vernon. How would they ever agree on the contours of a shared central government?

James Madison’s solution was federalism, a division of power between the federal and state governments, including outsize influence for sparsely populated states – which would have as many senators as the most populous ones and disproportionate sway in the electoral college, which selected the president. Together, these two branches populated the federal bench and the Supreme Court, further amplifying small states’ influence.

Today, federalism, the bargain that made the United States (US) possible, is threatening to tear it apart. Donald Trump is president despite losing the popular vote and remains in office because of the unequivocal support of a group of senators representing a minority of the federation’s population. The same Senate majority denied the last president a Supreme Court pick, ensuring a lasting conservative lock on the highest court in a country where conservatives are not a majority. Demographic trends will make this counter-majoritarian balance of power worse with each passing year, creating a crisis of democratic legitimacy in a country that once saw itself as the world’s model democracy.

If ever there was a time to reexamine Madison’s invention, this would seem to be it.

University of Texas professor Donald F Kettl takes up this task in his new book, The Divided States of America. He seeks to show how we got to this impasse and presents an argument for how federalism itself could be the instrument of our salvation. Kettl offers a clear and cogent exposition of the problem, but his answer to it, a “Hamiltonian solution to Madison’s great dilemma”, is little developed.

Kettl aptly describes why federalism was unavoidable when the Constitution was written in 1787. Many states did not agree with the draft mission statement for the United States that Thomas Jefferson had laid out in the preamble to the Declaration of Independence. Liberty and self-government might have passed muster if properly defined, but the assertion that “all men are created equal”, with inherent rights, would be mocked by generations of Southern slaveholders. Representatives from South Carolina and Georgia refused to support the declaration until a passage condemning the slave trade as “cruel war against human nature itself” was removed.

Equality has remained a flash point for inter-state conflict, a story Kettl traces through the Constitutional Convention, the Civil War, the adoption (and decades-long judicial annulment) of the 14th Amendment and its equal-protection clause, and “virtually every big domestic policy battle throughout American history”. Federalism’s balance of power has shifted back and forth, he observes, with inequality increasing whenever the federal government has taken a hands-off approach.

Inequality is at the root of America’s existential crisis, Kettl argues, and not only because it is higher here than in any of the world’s other leading industrialised nations. Income inequality among the states is growing, too, creating “more polarisation and more friction” and rendering “the United States a collection of states divided”. With Washington deadlocked, the states continue to go their own way in everything from infrastructure investments to Obamacare implementation. “Their policy differences are increasingly driving the country apart.”

Consider the contrasts. Mississippi has a poverty rate triple that of New Hampshire. Income inequality, measured as the ratio of the top one per cent of earners to the other 99 per cent, is more than three times higher in New York, Connecticut and Wyoming than in Iowa, Alaska and Hawaii. Mississippi’s infant mortality rate is twice that of Massachusetts, and its life expectancy is nearly seven years lower than Hawaii’s. The US is now “a nation where the government that citizens get depends increasingly on where they live,” Kettl laments.

Research shows that inequality breeds distrust in government, Kettl notes, which decreases electoral participation and compliance with tax collection while increasing political polarisation and corruption. “It is expensive, since more distrust leads to more regulation and litigation,” he writes. Combined with the erosion of Madison’s other great invention, the separation of powers, the republic has created a crisis it “may well not be able to survive”.

Kettl demonstrates that federalism has always been a dynamic experience, with fuzzy and shifting lines between federal and state powers. Key Supreme Court decisions – McCulloch vs Maryland(1819), Plessy vs Ferguson (1896), Brown vs Board of Education (1954) – have shifted the relative powers forward, back and forward again. Federal grants, an early-19th-Century innovation that lured states to become agents of national policy through offers too good to refuse, had an enormous impact, allowing federal powers to build interstates, set public school standards and insure the poor.

Such grants are central to Kettl’s solution, which draws inspiration from the writings of Alexander Hamilton, who championed a strong central government because he was skeptical that the states could ever give the country the direction it needed. Kettl’s advice is to transform the grants’ role by focussing them “primarily on inequality-busting initiatives” to redistribute wealth from rich to poor, and social benefits to the very young and very old from the rest of us. As part of this effort, Washington would take a stronger hand in how Medicaid is administered by the states and in encouraging the states to adopt policy innovations successfully tested by their counterparts.

These lightly sketched solutions may strike many readers as small bore, given the challenges facing the country, and perhaps more cautious than Hamilton himself would recommend. So too is Kettl’s analysis that “the core of the problem” is what he calls the “rise of light-fare television”, which he says has undermined federalism by encouraging snappy national fixes to complex, context-dependent problems.

But while Kettl’s solutions may not be convincing, his diagnosis of some of the pathologies undermining the republic is, and the historical background he provides on the evolution of Madison’s nation-founding invention will be useful to anyone seeking to flesh out additional remedies.