Chapter 3 Federalism 3 | 1

3 | 2 Why “Federalism” Matters Federalism is behind many things that matter to many people: –Tax rates –Speed limits –Liquor laws –School funding –Health insurance

3 | 3 Governmental Structure Federalism: a political system where local government units can make final decisions regarding some governmental activities and whose existence is protected Unitary System: local governments are subservient to the national government

3 | 4 Figure 3.1: Lines of Power in Three Systems of Government

3 | 5 Figure 3.1: Lines of Power in Three Systems of Government

3 | 6 Figure 3.1: Lines of Power in Three Systems of Government

3 | 7 Federalism: Good or Bad? Bad: –Source of confusion and/or controversy, particularly during times of crisis –Impedes progress and caters to local interests Good: –Contributes to governmental strength, political flexibility, and fosters individual liberty –Federalist #10 - small political units allow all relevant interests to be heard –Federalism increases political activity

3 | 8 Federalism: A Bold New Plan No historical precedent Tenth Amendment was added as an afterthought to clarify the limits of the national government’s power Elastic language in Article I: Necessary and Proper Clause expands federal power

3 | 9 Debating the Meaning of Federalism McCulloch v. Maryland (1819) –Could Congress charter a national bank? Yes, even though this power is not explicitly in the Constitution (Necessary and Proper Clause) –Could states tax the national bank? No, because “the power to tax is the power to destroy”

3 | 10 Dual Federalism Belief that the national government is supreme in its sphere, but the states are equally supreme in theirs. These spheres should be kept separate This idea was pretty much abandoned, particularly in the area of commerce. However, recent Supreme Court decisions have moved to strengthen states’ rights.

3 | 11 Federal-State Relations Grants-in-aid: –Dramatically increased in scope in 20thcentury –Attractive to states for both economic and political reasons –Federal activists work with intergovernmental lobbying groups to determine how and when grants are awarded

3 | 12 Federal-State Relations Categorical grants: for specific purposes defined by federal law; often require local matching funds Block grants: devoted to general purposes with few restrictions—states preferred block to categorical grants Revenue sharing: requires no matching funds and can be spent on almost any governmental purpose

3 | 13 Figure 3.2: The Changing Purpose of Federal Grants to State and Local Governments Budget of the U.S. Government, Fiscal Year 2005, table 12.2.

3 | 14 Table 3.1 Federal Grants to State and Local Governments (Federal Fiscal Year 2006)

3 | 15 Federal Aid and Federal Control Mandates: federal rules that states or localities must obey, whether or not they accept federal grants –When the federal government spends less on a preferred policy, it will pressure the states to spend more in that area Conditions of aid: tell state governments what they must do if they wish to receive grant money

3 | 16 A Devolution Revolution? During Reagan’s presidency, efforts were made to consolidate categorical grants and change them to larger “block grants”, which have fewer strings attached to them. This was the beginning of the devolution effort, which aimed to pass down many federal functions to the states Recent studies show that the success of devolution was limited

3 | 17 The Devolution Revolution Second-order devolution: the flow of power and money from the states to local governments Third-order devolution: the increased role of nonprofit organizations and private groups in policy implementation

3 | 18 Preemption Express preemtion: a federal law or regulation containing language explicitly displacing or superceding any conflicting state or local laws Implied preemtion: a federal law or regulation that directly conflicts with existing state laws, in the areas of intent or implementation

3 | 19 Congress and Federalism Members of Congress represent conflicting constituencies The erosion of parties increases political competition Americans differ in the extent to which we like federal versus local decisions

Increasing the power of the FEDERAL GOVERNMENT: Categorical Grants: A grant designed for a specific purpose. States must spend money in accord with national government’s wishes. Federal Mandates: A federal government tells states what policies to implement. Selective incorporation: Federal courts can overturn state and local practices. 3 | 20

Increasing the power of the STATE GOVERNMENT: Welfare Reform Act of 1996 States were given the power and money to run their own welfare program. States were given discretion to determine how to implement the federal goal of transferring people from welfare to work. Block Grants It is targeted money. Block grants to states have few strings attached, so states can make decisions about the details of where the money goes. 10 th Amendment: It reserves power to the states and to the people. It is being used to argue that power be returned to states. 3 | 21

Limiting Power of the National Government Establishment Clause Prevents the national government from establishing a national religion or taking any action that would show preferential treatment for one religion over another. (1 st ) Guarantee of a public trial — requiring trials to be open to the public. limits the government’s ability to violate the rights of citizens. Copyright © Houghton Mifflin Company. All rights reserved.3 | 22

Limiting the State Government Citizenship Clause of the 14 th Amendment- provides a national definition of citizenship that states cannot violate; requires states to provide citizenship guarantees to all who meet the definition of citizen. Selective Incorporation prohibits states from denying Bill of Rights provisions regarding freedom of expression, rights of the accused or privacy. 3 | 23