Advanced Placement Government and Politics
Chapter 3: The Federal System
Key Terms:
block grants; categorical grants; concurrent powers; cooperative federalism; creative federalism; delegated powers; dual federalism; enabling act; enumerated powers; extradition; federalism; full faith and credit; general purpose grants; general revenue sharing; implied powers; inherent powers; interstate compacts; McCulloch v. Maryland; prohibited powers; reserved powers; senatorial courtesy; unfunded mandates; vertical federalism
Relevant Supreme Court Cases
McCulloch v. Maryland; Garcia v. San Antonio Metropolitan Transit Authority; United States v. Lopez
I. Division of Powers.
A. The U.S. Const. created the federal system by allocating power between two levels of government, state and national. *** Federalism (federal system): A system of government which allocates power between national and state governments. "Federalism" and "federal system" are used interchangeably. Both national and state governments exercise power over the same geographical area.
B. National powers (Six)
1. Delegated: The expressed powers granted to the national government in the U.S. Constitution, listed in Articles I, II, III, and especially Article I, Section 8. Delegated powers are exercised only by the national government, not the States. Delegated powers are powers of the national government which are expressed. These are powers specifically listed in the Constitution.
2. Implied: Implied powers were established in the United States Supreme Court case of McCulloch v. Maryland. In McCulloch v. Maryland (1819) Supreme Court ruled that because of the "necessary and proper" clause in Article 1, Section 8, the national government had additional powers that were implied in that clause. Implied powers are powers of the national government that flow from its enumerated powers and the "elasticclause" of the Constitution. (page 63)
3. Inherent: Those powers that belong to the national government simply because it is the national government. (page 58) E.g., declare war, foreign affairs, acquire new territory.
4. Prohibited: Expressly bar government from specific actions, e.g. state governments cannot coin money, no ex post fact laws or grant titles of nobility.
5. Concurrent: Concurrent powers are those which are exercised independently by both the national and state governments. (page 60) Those powers shared by both levels of governments, i.e., state and national. Examples: power to tax, power to borrow, and power to regulate commerce within their own borders. Both the federal and state government collaborate with each other within many spheres.
6. Reserved: Reserved powers are powers given to the states. 10th Amendment: "The power not delegated to the United States by the Constitution., not prohibited to it by the States, are reserved to the States or to the people." State powers then are called reserved powers. Most significant reserved power given to states is the power to determine the qualifications for voting. Courts have interpreted reserve powers as falling into three categories:
a. Public education
b. Police powers; criminal laws
c. Right to regulate commerce within a state, intrastate commerce.
II. Federalism (In general)
A. Vertical Federalism
1. Federalism: A "constitutional arrangement whereby power is divided by a constitution between a national government and constituent state governments, which are called states in the United States. The national and the constituent governments both exercise direct authority over individuals.
2. Vertical Federalism described the obligations established by the Constitution between the states and the national government.
a. national government required to provide a participatory, democratic government preserve the territorial integrity of the states; and provide protection and assistance in times of domestic upheaval.
b. states consider proposed constitutional amendments and provide the machinery for conducting elections for national officers, i.e., president, vice president and members of Congress.
B. Horizontal Federalism
1. In addition to having a relationship with the federal government (vertical federalism), states have relationships with each other (horizontal federalism).
2. Article IV of the U.S. CONST., describes the basic relationships between states, in Section 1, "Full Faith and Credit," and Section 2, "Privileges and Immunities." The "Full Faith and Credit" clause is an example of horizontal federalism.
a. Section 1: Concept is that each state must accept other states' public acts, records, and judicial proceedings. E.g., divorce decree in one state must be accepted by other states.
b. Section 2 means that citizens are granted the same rights and duties, no matter what state they reside in. Section also contains provision regarding extradition.
c. An example of horizontal federalism is the act of one state recognizing a divorce decree of another state.
III. Limitations of State Authority, i.e., the Supremacy Clause
A. Article VI of the U.S. Const. Makes it clear that whenever state and federal laws conflict, the federal law is supreme.
B. *** Supremacy Clause (national supremacy) is that constitutional requirement that federal law prevails over state law. Simply put, the actions of the national (central) government take precedence if the national government is acting within the scope of constitutional authority.
"This Constitution, and the Laws of the United States which shall be made
in Pursuance thereof; and all Treaties made, or which shall be made, under
the Authority of the United States, shall be the supreme Law of the Land,
and the Judges in every State shall be bound thereby."
C. The effect of the Supremacy Clause is to establish a hierarchy of authority:
1. United States Constitution
2. United States Laws and Treaties
3. United States Supreme Court Decisions
4. United States Administrative Regulations
5. State constitution
6. State Laws
7. State Supreme Court Decisions
8. State Intermediate Appellate Court Decisions
9. State Administrative Regulations
10. Local Ordinances
D. Administrative Regulations are those rules promulgated by the executive branch that clarify, limit, explain and hone legislation. Example: Licensing of barbers
IV. Case study of the "Double Nickels"
A. The federal fifty-five-mile-per-hour speed limit was repealed in December 1995 after two decades.
B. Twenty states (mostly Western ones) increased their speeds to seventy miles per hour or more. Montana imposed no day speed, and Nevada had no speed limits at all.
C. Why were fifty-five-mile-per-hour speed limits imposed?
1. To save gas after oil shortages in the 1970s.
2. Insurance industry studies say fewer highway deaths at lower speeds.
3. Same law removes helmet rules and zero alcohol tolerance rules.
D. Uncle Sam: the carrot and the stick
1. Federal government involved through highway construction funds (Federal Highway Trust Fund).
2. To get federal funds, states kept lower speeds until Congress changed the law in 1995.
3. President Clinton and Congress responded to states' complaints (the federal system and election politics in action).
V. The Federal System
A. Federalism involves constitutional power-sharing between national (central) and local units — each having their own jurisdictions.
1. Ours evolved from a unitary system, which was common in Europe and still is common around the world.
a. Unitary systems have power at the national center.
b. Policy is made there and is administered through units at the regional level (no local governmental partners).
2. Our structure involves dividing authority among the federal government, states, and their subdivisions in the local areas (cities, counties, school districts, etc.)
3. According to Cummings and Wise, the question of how the powers will be divided has been central to the system. (The Civil War, in part, was fought over this.)
B. Another case study: Rodney King (1992)
1. Rioting erupted when an all-white jury acquitted white officers of savagely beating Rodney King, a black detainee.
2. Police in Los Angeles were slow to respond, so the governor sent in the California state
militia (national guard).
3. The president took the state militia under federal control, and also sent federal marshals
t o put down the disturbance.
C. Many nations of the world describe themselves as federal, but most are unitary systems disguised in constitutionally federal clothing.
VI. Federalism: The Pros and Cons
A. The Pros
1. Federalism permits diversity and diffusion of power.
2. A number of local units, not remote bureaucracies, deal directly with local
problems. (Local governments may better understand local problems.)
3. Has multiple access points for citizen participation in democracy.
4. Less chance that individual rights will be abused by a large aloof bureaucracy with power
concentrated in a few hands.
5. Multiple layers of government provide more avenues for innovation, experimentation,
and problem solving. Many of the FDR New Deal programs copied the states.
6. It suits a large country with a very diverse population like the United States.
B. The Cons
1. Federalism permits some state and local areas to continue race discrimination (Southern
school segregation).
2. Under a federal system, special interests and certain localities can frustrate the realization
of national goals. (Examples: poor wages and working conditions for coal miners in West
Virginia; automobile and oil industries in some areas)
3. Local communities may lack the expertise to solve problems, and may provide favoritism
to some at others' expense.
4. Law enforcement and justice maybe unevenly applied among the states.
5. Local autonomy may get in the way of national unity.
VII. The Checkerboard of Governments
A. Public has to deal with a bewildering array of governments with overlapping local districts. (Example: Park Forest, Illinois, residents paid taxes to eleven units.)
B. 1995 Census Bureau government count found 86,743, including all federal, state and local
entities.
C. Martin Grodzins says the federal analogy is not of a three-layered (federal, state, and local) cake, but a marble cake with all parts interlaced. Marble cake federalism refers to the three-layered system of government.
D. Cooperation and tension among federal, state, and local governments (New York).
1. New York almost went into economic default in 1975.
2. State didn't want to bail it out, but later took over all its books.
3. President Ford planned to let it default, but later relented.
E. Desegregation of schools, race riots, provide a number of examples.
1. In 1957, federal troops are sent by Eisenhower to enforce court-ordered integration at
Central High in Little Rock, Arkansas.
2. JFK used federal troops at Ole Miss and the National Guard at University of Alabama to
protect entering black students. (Alabama Governor Wallace opposed him.)
3. LBJ sent in paratroopers to quell race riots in Detroit in 1967.
4. President Bush sent troops and federal agents to Los Angeles when rioting erupted
following the Rodney King verdict.
F. Differing views on the economic and political role of the federal government.
1. Democrats and Northern GOP see the federal government as a social and economic
problem-solver.
2. Conservative GOP and Southern Democrats see the federal government as a danger to
individual liberties, and as an "octopus" whose tentacles strangle local initiative.
VIII. The Changing Federal Framework
A. From the nineteenth century until almost the end of the New Deal, dual federalism, i.e., some federal-state cooperation existed, but the states and the federal government chiefly saw themselves as competitors. Dual federalism is a concept of government under which the Supreme Court saw itself as a referee between two compelling power centers — the states and the federal government — each with its own responsibilities. (page 74) The Supreme Court became the referee.
B. New Deal social programs changed the equation.
1. Courts approved New Deal intervention in local areas.
2. Cooperative federalism evolved. Cooperative federalism is described as various
levels of government are seen as related parts of a single governmental system,
characterized more by cooperation and shared functions than by conflict and competition.
(page 74) Federal government enhances its power and governance becomes "we are all in
this together, so we should cooperate." All governments are seen as being a part of a bigger system.
3. Michael D. Reagan says no wall of separation should exist between state and federal
government. He says federal financial aid creates "a nationally dominated system of shared power and shared functions."
C. LBJ called his innovative Great Society programs "creative federalism." Creative
relationship between Washington and the states. During his administration, Congress enacted legislation that further expanded the role of the federal government. (page 75)
D. Nixon spoke of "new federalism," which returned large chunks of federal taxes to the states
E. A new model of federalism - regulatory federalism - evolved with the advent (since the mid- 1960s) of extensive federal regulations mandating functions for states and localities to perform.
1. Environmental regulations, and regulations on civil rights, hiring, and workplace safety
created new mandates for state actions.
2. Often these mandates came without federal funds, i.e., "unfunded mandates," to cover
any of the implementation costs. For this reason, mayors, governors, and local officials
have bemoaned the problem of unfunded mandates. Unfunded mandates re federal
laws that require states to meet certain regulatory standards, but provide no money to help the states comply. Congress enacted a law in 1995 to curtail the practice. (page 75) New York spent $1.3 billion to make its subways accessible to the disabled, without federal assistance.
3. In the mid-1980s, President Reagan put forward his view of a "new federalism," which
amounted to cutting taxes, saying money was not available for many social programs, then cutting funding and forcing the states to pick up more of the costs.
4. The pressure for a strong national role seems to be predicated on the fact that we have
national goals being set that may or may not be equally popular in every state and locality.
5. The Unfunded Mandates Reform Act became law in 1995. It requires Congress to fund
mandates placed on the states unless a majority of the House and Senate voted not to do so. The law only applies to new legislation.
IX. The Historical Basis of Federalism
A. The Philadelphia Convention created a federal system with sharing of powers between federal and state governments (a middle ground).
B. The new Constitution followed the much weaker Articles of Confederation in a country with little sense of national identity.
C. To replace the old system, the alternatives needed examination.
1. Unitary form never would have "sold" in the states because it was too much like the
British system that they revolted against.
2. Regional diversity also would have made a strong central control system like the unitary
one unlikely.
3. The supporters of federalism at the convention could argue that distributing powers
between states and the central government would assure that the latter would not become too powerful.
X. A Tool for Nation Building
A. Dilemmas of European colonial states in Asia and Africa after World War II
1. Create a strong central government and be dictated to (as under the colonial system)
2. Unite in some federal form, permitting a semblance of self-governance
B. In the United States, federalism gave the disparate population a chance to join together without
losing much, and still provided a basis for a sense of national identity.
XI. The Constitutional Basis of Federalism
A. The Constitution established a framework for the American federal system.
1. Federal powers, exercised by three branches, were enumerated or listed in Article I.
Enumerated powers are powers that are granted specifically to the three branches of the
federal government under the Constitution. Synonomous with delegated powers and
expressed powers. (page 77)
2. The "necessary and proper" clause (often called the "elastic clause") at the end of Article I
and court interpretations of its meaning buttress the idea that the national government,
through the Congress, has implied powers.
3. The Supreme Court has also held (United States v. Curtiss-Wright Export Corp., 1936)
that the federal government has some "inherent" powers that go along with being a
government (Example: foreign policy direction).
4. The Supreme Court, as arbiter between the federal system and the states, has fluctuated
between states' rights and expanded federal power.
B. McCulloch v. Maryland
1. Ruling by Marshall in this case supports "necessary and proper" implied powers concept.
2. At issue: Can Congress create a bank? At stake: How large and creative a role could the
federal government adopt anchored by the "necessary and proper, clause?
3. Another issue in the case was whether the state of Maryland could authorize taxes against
a federal institution. The Court rules that "the power to tax involves the power to destroy."
C. The Division of Federal and State Power
1. The Tenth Amendment seems to limit Congress to items listed in the document, since it
said the powers not delegated by the Constitution to the federal government nor prohibited
are reserved to the states and people respectively.
2. In McCulloch, the Court supported the idea that powers need not be "expressly" stated
to be acceptable under the document. Marshall took a very expansive view of the federal
role, at the expense of the states.
3. Marshall's successor, Justice Taney, leaned in a states' rights direction. For almost 100
years, subsequent courts agreed.
4. Today's states' rights advocates depend on the language of the Tenth Amendment for
support.
a. They view the Constitution as a compact among states.
b. Today, however, the national government is often viewed as representing the
people, not just the states.
D. Restrictions on the States
1. The "supremacy clause" of the Constitution: laws and treaties are the supreme law of the
land, binding the states to these priorities.
2. Among many other limits, states are forbidden to coin money, or pass bills of attainder or
ex post facto laws.
3. The Bill of Rights and the Fourteenth and Fifteenth Amendments restrict states in
denying rights to former slaves.
4. Local governments are technically an arm of the state, so state limits apply to them as
well.
E. Federal Obligations to the States
1. *** Ensure representative democracy in the states, i.e., a republican form of
government.
2. Protect the states from invasion or domestic violence
3.Congress is to handle the arrangements for admitting new states:
a. Passing enabling legislation to admit new states An enabling act is a
congressional act that allows the people of a territority desiring statehood to frame a
state constitution. (page 82)
b. Permitting them to write a state constitution.
F. Interstate Obligations and Rights (under Article IV)
1. Full faith and credit: States are expected to give recognition to the civil decisions of other
states, including laws, documentary records, and court decisions. Full faith and credit
refers to a clause in Artivle IV of the Constitution which required that each state respect the
laws, records and court decisions of another state. In practice, this means that a judgment
obtained in a state court in a civil (non-criminal) case must be recognized by the courts of
another state. (page 82)
a. Normally means civil judgments made in a court in one state are expected to be
recognized in another.
b. Marriage licenses may be a problem where divorce decrees are issued (Williams
v. North Carolina).
2. Privileges and Immunities: Citizens of each state are entitled to the privileges and
immunities of citizens of the state they are currently in.
a. According to the Supreme Court, this rather nebulous requirement means that
one state cannot discriminate against citizens of another state.
b. States still discriminate (Example: In-state and out-of-state tuition for college
students).
3. Extradition and Rendition: Upon request, a governor in one state can hold a person
accused of a crime in another state, pending the person's being returned to the original
state for disposition of the case against him/her. Extradition is a constitutional provision
which allows a state to request another state to return fugitives. (page 82)
a. Governors have sometimes refused to extradite.
b. Chapter 3 has Scottsboro case example.
c. Custodial decisions and violations of court orders involving parents kidnapping
their children have been a problem for this principle.
4. Interstate compacts: States may enter into financial arrangements with other states,
even those creating a new multistate administration, only with the approval of Congress.
(page 83)
a. One example: The New York Port Authority (operated airports, bridges, tunnels
and bus stations between New York and New Jersey)
b. Interstate compacts are becoming a useful tool for planning and cooperative
development in bi-state metropolitan areas.
XII. The Growth of Strong National Government
A. The words in the Constitution concerning the relationship between the federal government and
states have not changed since 1787.
B. Senator Dirksen commented that soon, Rand McNally will soon be the only one interested in
state boundaries, implying that national government is dominant.
C. Why the rise of big government?
1. A large, growing society with complex needs has spurred the growth of the national government.
2. The taxing power of the federal government and public pressures for general welfare
programs have mushroomed.
3. Federal powers under the commerce clause have grown in recent decades, especially in
the 1960s under LBJ's Great Society, and in the 1930s under FDR's New Deal.
4. Opposition from conservatives who opposed big government handouts during these
years was unable to roll back the momentum that large government had. For example,
programs like Social Security and Medicare were not put on the chopping block.
D. *** "The Reagan Revolution" ["New Federalism"]
1. *** Concept was to restore to state governments the responsibility for making and
implementing policies.
2. Cut domestic spending in poverty programs like social welfare, food stamps, and
housing subsidies for low-income people. The upshot: the poor got poorer.
3. In most cases, they were reductions in what might have been spent, so actual dollars
increased in the programs.
4. Still, if the national government was doing less than it planned, states and localities
would be asked to pick up the slack.
5. It is unlikely that the role for the federal government for these programs will diminish
much because the public likes national leadership in these areas. Cuts are likely to be
marginal at most.
E. Big Government and Foreign Policy
1. The nuclear age and defense needs related to it have ballooned the federal role and
spending in these areas.
2. With the end of the Cold War, President Bush was pressured for major defense cuts.
Supporters of social services were seeking the elusive "peace dividend," which never
appeared.
3. Cuts in defense meant lost jobs or wage cuts for the states and citizens wedded to the
defense industries.
XIII. The Impact of Federalism on Government and Politics
A.The federal system influences the actions of all levels of government - even many private
associations.
B. Federalism affects the structural makeup of governance.
1. Senators, though federal officials, come from states. Each state gets an equal number of
senators, despite its size.
2. House members, though federal officials, are chosen in local districts. Sitting together,
they represent the views of their state on national policy issues.
3. Federalism helps assure that the state and local court systems coincide with the federal
system.
4. Federalism encourages senatorial courtesy, in which the president consults with
senators of his party in a state before making an appointment. (page 86)
5. The AFL-CIO, AMA, and ABA demonstrate that large interest groups also organize
along federal lines.
C. Federalism and American Politics
1. Presidential candidates like Dole and Clinton are not appointed by the national party, but
must gain their support in statewide presidential primaries during early spring of election
year.
2. Parties themselves are organized along quasi-federal lines, i.e., a national party and fifty
state parties.
3. State parties are autonomous. Some are better organized than others and provide good
governmental officials, while the candidate output of others and their performance records
may be lackluster.
D. Policy Outcomes in the States
1. States with large, two-party elections are likely to have broad social welfare policies
because both parties need the votes of the poor.
2. Other studies suggest that the amount and quality of social programs correlate with the
per-capita income of the state. This factor best explains the disparity of taxing, spending,
and social services between states.
3. In states with high levels of political activity by lower socioeconomic groups, policies
favored redistribution.
4. The federal system influences people's lives because it affects the selection of public
officeholders and their penchant for providing social service programs.
E. Federalism Today
1. Although federal aid to the states has increased every year since 1950, it has remained
level or has declined slightly over the last few years as a percentage of federal budget
outlays.
2. In 1980 grants to state and local governments accounted for 15 percent of the budget. By
1990 it was 1 percent. In the budget for fiscal year 1997, it was back up to 15 percent.
3. Categorical Grants
a. Also known as grants-in-aid. Categorical grants are earmarked for specific
purposes like pollution control, schools, and hospitals. (page 89)
b. They account for about 90 percent of all federal grants.
c. There were 618 separate grant programs administered by federal agencies in
1995.
d. Requires some matching funds based on the ability of the state to pay
(Equalization principle: poor states pay less, rich states pay more as a match). This
matching requirement is a federal requirement that state or local governments
must put up some of their own funds in order to get federal money. (page 90)
e. Requirements are spelled out in law, and administrative regulations by the
administering department.
4. Block grants
a. Block grants are federal grants to the states and local communities that are for
general use in a broad area, such as community development. (page 89)
b. They accounted for 10 percent of all grants in fiscal year 1995.
c. Major ones were community development, social services, health care,
employment, and training and education.
d. In 1994 the GOP Congress tried to shift more categorical grants into block
grants to give state and local communities more flexibility in how to spend the
money. In 1996 this type of effort was signed into law by President Clinton as
welfare reform.
5. General purpose grants
a. General purpose grants, the smallest category of grants, are federal grants
that may be used by states and local communities mostly as they wish. (page 89)
b. General revenue sharing was in this category, but was discontinued.
6. General revenue sharing
a. States and localities could use as they wished.
b. Critics feared it would be used for frivolities like golf courses.
c. Local officials loved it because they saw it as new money for city budgets, with
few strings attached.
d. The program was discontinued in 1986.
7. State and local spending has been increasing at an even faster rate than federal.
a. The federal government collects 81 percent of all income taxes, which grow with
the economy and generate substantial capital growth.
b. State and local governments depend on real estate taxes and sales taxes, which
do not grow as fast as the economy-based income taxes.
c. More states are getting into the income tax business, though. Only seven states
do not tax incomes.
XIV. Regulatory Federalism
A. Regulatory laws are passed to address national goals - like providing clean air and water — and
similar goals supported by states and localities.
1. Typically these have complex federal standards.
2. These laws also generate a blizzard of paperwork resented by local units.
3. Typically, federal funds are too limited to cover the costs of meeting the requirements.
This causes federal/local tensions.
B. These programs got their starts in the 1960s.
1. Civil Rights Act (1964) is an early example, as is the Highway Beautification Act (1965),
and the Occupational Safety and Health Act (1970).
2. Other programs deal with endangered species, clean water and air, education,
employment, the disabled, and age discrimination.
C. Some of them bar actions by state and local governments, such as discrimination in hiring.
D. Others tie behavior in one law to a reward or penalty in another.
1. These are referred to as crossovers.
2. For example, the fifty-five-mile-per-hour speed limit law was tied to federal highway
funds.
3. Another example: federal highways were withheld from states with laws allowing those
under 21 years of age to drink alcohol.
E. Other regulations set federal standards and have the states enforce them, such as the Clean Air Act of 1970 and its newer version in 1990.
F. States and local governments complain about unfunded mandates (requirements that they enforce
federal standards without the federal funds to do so).
G. A 1995 federal law says no unfunded mandates in the future unless a majority of Congress
agrees to them.
XV. The Future of Federalism
A. The relationship between Washington, the state houses, and city halls has evolved over the years.
Both conflict and cooperation remains.
B. Innovations are evident.
1. Minnesota adopted a system of school aid to ensure equal education funds for students,
regardless of the poverty of their district, thereby ushering in a new state-to-local
relationship in education.
2. By 1994, thirty-five states and the District of Columbia had circuit breaker property tax
relief for fixed income elderly and low-income citizens.
3. More efforts are being made to deal with area wide metropolitan problems.
C. Critics of federal aid to states question whether states are willing or able to meet their
responsibilities.
D. Many states are still caught in a fiscal squeeze, and may find innovation difficult. Cities with
more poor inner-city residents are finding that demands for more services are beyond their fiscal
capacities.
E. Key question: Can the federal system designed in 1787 continue to meet the demands of the urban, technological society it faces in the twenty-first century?