1. SECTION 2: “American Federalism: Conflict and Change”
Chapter 4
SECTION 2: “American Federalism: Conflict and Change”

2. American Federalism: Conflict and Change
Over the past 200 years, conflicts over the balance of power between the national and state governments have led to changes in American federalism.
What role does the Supreme Court play in American federalism?
How was government power divided in dual federalism?
What events caused the expansion of national power in the twentieth century?
What is new federalism?

3. Dual Federalism
The first era of American federalism, dual federalism, lasted from about to the 1930s. Both state and national government were equal authorities operating within their own spheres of influence, as defined by a strict reading of the Constitution.

4. Dual Federalism The Marshall Court
1819, McCulloch v. Maryland: bank dispute reached Supreme Court
Court ruled in favor of nation’s authority to start bank
Chief Justice John Marshall argued charter justified by Constitution’s necessary and proper clause
Bank would help nation properly execute powers to regulate commerce and currency

5. Dual Federalism “A House Divided”
U.S. became bitterly divided over issue of slavery
Debate wrapped up in arguments about states’ rights and national power
Southern slave states resisted national measures to outlaw slavery in new states and territories
Held states sovereign, could make decisions for themselves

6. Dual Federalism “A House Divided” (cont’d.)
Doctrine of nullification: some southern politicians believed states had right to nullify national laws that contradicted or clashed with state interests
State could either choose to follow law or secede from Union
Doctrine of secession: idea that states had right to separate from Union

7. Expanding National Power
The Civil War reinforced the supremacy of the national government over the states. In the years following the war, new challenges continued to shift the balance of power in favor of the national government.

8. Turn-of-the-Century Reforms
National government passed legislation to reform social, business conditions
1887: Interstate Commerce Act regulated the railroad industry
Set restrictions on rates railroads could charge

9. Turn-of-the-Century Reforms
1890: Sherman Antitrust Act prevented monopolies: exclusive control of a good or service in a particular market
Encourage fair competition in all industries
Early 1900s: used to break up large monopolies such as American Tobacco

10. Turn-of-the-Century Reforms
New laws expanded national government’s power to regulate business
Court cases limited reach of national power
1895, United States v. E. C. Knight Company: sugar refining companies operated locally, could not be regulated by national government

11. Turn-of-the-Century Reforms

12. The New Deal 1933: President Franklin D. Roosevelt introduced New Deal
Series of national programs to address needs of Americans
Some assisted unemployed, elderly
Others provided jobs
Major change in role of national government
National and state governments worked together to meet crisis
Federalism under New Deal known as cooperative federalism

13. The Great Society
1960s: President Lyndon Johnson expanded powers of national government
Great Society program: initiatives aimed at eliminating poverty and social inequity
Creative federalism: released federal funds to states to achieve national goals
1965: Medicaid provides free health care for poor

14. The Great Society
If national government determines states not fully cooperating, funding withheld
Threat of losing money powerful tool
Grant system increased size, cost of national government
Urban renewal grants increased from $212 million (1964) to more than $1 billion (1970)

15. New Federalism
Throughout much of U.S. history, the powers of the national government expanded. Beginning in the 1980s, many political leaders worked to reverse this trend by returning authority to state governments. This era is known as new federalism.

16. New Federalism The Reagan Years
1980s: President Ronald Reagan supported returning power to the states
Believed national government less effective than state governments in providing services to people
Reagan worked to reduce size of government by cutting national grant money to states

17. New Federalism The Devolution Revolution
1994 elections: Contract with America—Republican campaign promise to achieve specific goals
Central idea: devolution—returning power to states
Reduce size and power of national government by eliminating costly federal programs