What is federalism?

The term has two opposing meanings

The Economist explains

Jun 13th 2017 by M.S.

EMMANUEL MACRON’S agenda for strengthening the European Union has revived talk of a “federal Europe”. The French president’s ambition will be easier to achieve without Britain: it has tended to follow the line of Margaret Thatcher, who in 1990 said the introduction of the euro might lead to “a federal Europe, which we totally and utterly reject.” Three years earlier Thatcher’s ideological ally, Ronald Reagan, had endorsed federalism in the United States, with an executive order that claimed to re-establish “the principles of federalism established by the Framers [of America’s constitution]” by taking power away from Washington and giving it to the states. “Federalism is rooted in the knowledge that our political liberties are best assured by limiting the size and scope of the national government,” Reagan proclaimed. The reader will have noticed that “federalism” has two opposite meanings here, in one case connoting a stronger central government, and in the other a weaker one. Why is that?

The short answer is that it is Richard Nixon’s fault. The long answer starts with America’s constitutional convention of 1787, where the term “federalism” was coined. Those favouring a powerful central government, including Alexander Hamilton and James Madison (who eventually became the chief authors of the constitution), adopted the name “federalists”. Those who wanted strong states and a weak central government became the “anti-federalists”. The Federalist Papers, a series of arguments for the new constitution written by Hamilton and Madison, acknowledged the need for balance between state and federal power, but they mainly favoured the centre. After the constitution was adopted, the advocates of strong central government (mainly from Northern states) coalesced into the Federalist Party. When the system collapsed into civil war in the 1860s over the issue of slavery, the North’s victory strengthened the power of Washington. It was further reinforced by the expansive economic and social programmes of the New Deal, so that by the 1950s it was unclear whether America was still a federation or effectively a unitary republic.

In the 19th and early 20th centuries many other new states with significant internal divisions also embraced the federalist concept, including Brazil, Canada, Mexico and Switzerland. During the second world war, the idea took hold that a European federation, with an overarching European government sharing power with national states, might be the key to ending the continent’s persistent wars. In Italy, Altiero Spinelli founded the European Federalist Union in 1943. Winston Churchill called in 1946 for the creation of “a kind of United States of Europe”. Because the European states began with no joint federal union at all, “federalism” in Europe naturally meant favouring a stronger one. This continued to be the case as the European Coal and Steel Community evolved into the European Economic Community, and was entrenched by the language of the Treaty of Rome in 1957, calling for an “ever-closer union”. When one calls current European politicians such as Martin Schulz or Guy Verhofstadt “federalists” one means that they favour a stronger EU with greater powers for Brussels.

In America, however, things had changed. In the 1960s, in the face of the federal government’s Civil Rights Act, white supremacists again rallied to the cry of states’ rights. Meanwhile, conservatives and business interests had come to resent federal regulations and welfare programmes, and felt that the decentralised side of federalism had been betrayed. President Nixon knew how to take advantage of these resentments. In 1969 he proposed “a New Federalism in which power, funds, and responsibility will flow from Washington to the states and to the people.” Little came of this, but the sense that federalism primarily meant constraining the national government became entrenched in the Republican Party. The upshot is that today, when Europeans speak of “federalism” they mean giving Brussels more power, whereas when Americans speak of “federalism” they mean giving Washington, DC less.