Federalism is a basic Structural feature of the American political system that has generated a great deal of conflict throughout American political history. Federalism involves multiple layers of government with shared powers amongst them and powers unique to each of the levels of the government.

The three basic levels of American federalism are the national or federal government, the states, and the local governments (counties, cities, townships). Whereas most political systems of the world are unitary systems (one central govt. with local administrative branches taking direction from it), the American system is a system of divided government. This reflects the desire for limited government of the Founders.

Sources of Federalism-

• The tenth amendment of the Constitution
• The fourteenth amendment
• The grant of unique powers of various levels of government under the Constitution.
• Numerous Supreme Court decisions (e.g., McCulloch v. Maryland in 1819 ).

Evolution of Federalism-

1. The Civil War increased the power of the federal government (1860-1865). But the federal government had been providing aid to states and localities in the forms of grants-in-aid since early in the 19th century without much complaint from states. In fact, the states had more power than the national government for most of that century. Strong states and a weak federal government was known as dual federalism.

2. The Great Depression of the 1930's increased the power of the federal government as the federal government took measures to get the country out of the economic depression. The New Deal, the policies of President Franklin Delano Roosevelt, expanded both the scope and power of the federal government in many ways (come to class to find out what these were). This expanded role of the federal government based on partnership with states was known as cooperative federalism.

3. The New Deal Coalition made up of groups that supported the policies of Franklin Roosevelt remained the dominant political force in the United States until the late 1960's. Cooperative federalism continued through the administration of John F. Kennedy (1960-1963) and Lyndon Johnson (1964-1968) but with a greater emphasis on targeted aid to the poor in the form of categorical grants (i.e., monies provided by the federal government to states but limited as to the purposes for which they could be spent). It was at this point that an outcry developed about and intrusive and domineering federal government.

4. Richard Nixon (1968-1974) and Ronald Reagan (1981-1988) were elected running against the federal government. (For details, come to class). They instituted programs such as General Revenue Sharing (Nixon) and block grants (Nixon and Reagan) that shifted some power and revenues back to the states and localities. The policies of the Nixon and Reagan eras are known as the New Federalism and they have carried over into the Bush and Clinton era. (Wanna know how? Come to class).

5. With the election of a conservative Republican-dominated House in 1994 and Republican control of the Senate, there has been a systematic effort to limit the power of the federal government.

6. Bill Clinton stressed “devolution.” This meant having programs that were run by the federal government shifted over to the states. In 1996, he succeeded in having a federal program (Aid to Families With Dependent Children) shifted over to the states so that now it is the states and localities that handle this welfare function. Clinton saw states as “laboratories” were new ideas a policies could be tested.

Conservatives generally hold the view that the federal government should deal only with matters of defense, foreign commerce, and diplomacy. They favor decentralized decision making which grants more power to states and localities. This view is more widely held by the Republican Party (although many Democrats have shifted closer to that position).

Liberals generally are less suspicious of federal power. They argue that under the Constitution (the supremacy clause), the federal government is superior to the states. Also, they perceive the federal government as the champion of the rights of the "underdog" that have rarely been defended by the states.

The text stresses that state and local governments carry out most government functions. Also, politicians run claiming they will cut the size of government but even conservatives such as Reagan of current president Bush have not cut the size of government. Recent Supreme Court decisions have been based on the idea of state sovereignty. For example, the Court has refused to uphold the legality of state laws requiring state governments to enforce federal minimum wage laws. Finally, at the popular level, despite all the ranting against big government, people support big defense spending, Social Security, Medicare, and other government programs and entitlements. So all the talk of big government might be a convenient campaign slogan or a political straw man.

Student must be able to describe the growth of the federal government and the factors behind that growth. They must be able to discuss the inconsistencies in the arguments against “big government.” They must know the current trends in federalism (the marble cake analogy, devolution, the Supreme Courts’ doctrine of state sovereignty, etc.). They must be able to identify conservative and liberal positions on the issue of federalism and be able to critique the liberal and the conservative views.

I have stressed that large subsidies (government outlays) go to wealthy and powerful interest groups. As a percentage of federal taxes, corporations have been paying a smaller and smaller percentage since 1940. Most of the Fortune 500 companies have paid no federal taxes since 2002. Many government outlays and benefits do not go to the poor. Equating big government with welfare to the poor is thus a misguided view.