The Free Market

Home | Mises Library | Toward Real Federalism

Toward Real Federalism

The Free Market

Tags U.S. HistoryPolitical Theory

08/01/1995Clyde Wilson

The Free Market 13, no. 8 (August 1995)


Just a few years ago we had a bicentennial celebration of the Constitution. Republicanism and federalism, the two most salient features of the Constitution, were never mentioned. Instead we had a glorification of multiculturalism and the central state. 

Federalism is one of the least understood, both theoretically and practically, of all political forms. Today we hear talk of restoring federalism and decentralized government. But we must beware of phony forms of top-down federalism that will be invented by cornered politicians. 

Federalism is not when the central government graciously allows the states to do this or that. That is just another form of administration. True federalism is when the people of the states set limits to the central government. 

Fundamentally, federalism means states rights. The cause of states rights is the cause of liberty. They rise or fall together. If we had been able to maintain the real union of sovereign states founded by our forefathers, then there would not be, could not be, the imperial central state that we suffer under today. 

The loss of states rights is coterminous with the rise of the American empire, where a vast proportion of the citizens' wealth is engrossed by bureaucracy; where our personal and local affairs are ever more minutely and inflexibly managed by a remote power; where our resources are squandered meddling in the affairs of distant peoples. 

That happy old Union was a friendly contract—the states managing their own affairs, joined together in matters of defense, and enjoying free trade among themselves. Indeed, enjoying free trade with the world, because the Constitution, as is sometimes forgotten, required all taxes to be uniform throughout the Union and absolutely forbade taxation of the exports of any state. The federal government was empowered to lay a modest customs duty to raise revenue for its limited tasks, but otherwise had no power to restrict or assist enterprises. 

That is what the States United meant to our Founders, a union of mutual consent and support. It did not mean a government that dictated the arrangement of every parking lot in every public and private building in every town, and the kind of grass that a citizen must plant around his boat dock. 

It did not mean the incineration of women and children who might have aroused the ire of a rogue federal police force, unknown to the Constitution and armed as for a foreign enemy. It did not mean that billions would be spent restoring oriental despots to their thrones in distant lands. Had George Washington been confronted with any of these things, he would have reached for his sword. 

We know the problems. Where should we look for solutions? Thomas Jefferson gives us the answer: our most ancient and best tradition, states rights. In his first inaugural Jefferson remarked that in most ways Americans were very happily situated, and then asked, "What more is necessary to make us a happy and prosperous people? Still one thing more, fellow citizens—a wise and frugal government, which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits." This government "shall not take from the mouth of labor the bread that it has earned. This is the sum of good government." 

But how to preserve this form of government? What should we do, or not do? Jefferson answered: preserve elections (not the party system), maintain equal justice under the law, rely on the militia, avoid debt, maintain the freedom of speech, religion, and trial by jury, avoid entangling alliances. And most important: "the support of the state governments in all their rights, as the most competent administrations for our domestic concerns and the surest bulwarks against anti-republican tendencies." 

There is a large sophistical literature which tells us that states rights was for Jefferson just a temporary expedient for other goals. This is false. For his own generation and several following, it was understood that the state sovereignty of the Kentucky resolutions was Jefferson's primary platform as an American leader. 

John C. Calhoun, speaking in exactly the same tradition a generation later, said: "We contend, that the great conservative principle of our system is in the people of the States, as parties to the Constitutional compact." Without "a full practical recognition of the rights and sovereignty of the States, our union and liberty must perish." 

Why are states rights the last best bulwark of our liberties? It is a question of the sovereignty of the people—in which we all profess to believe. Every political community has a sovereign, an ultimate authority. The sovereign may delegate functions (as the states did to the federal government) though not alienate authority. It may not always rule from day to day, but it is that place in the society that has the last word when all else is said and done. 

All agree that in America the people are sovereign. But what do we mean by people? How do we know when the people have spoken? A simple electoral majority, which can shift the next day, is not enough to determine questions of sovereignty. In American terms the government of the people can only mean the people of the states as living, historical, corporate, indestructible political communities. 

The whole of the Constitution rests upon its acceptance by the people acting through their states. The whole of the government reflects this by the representation of the states in every legitimate proceeding. There is no place in the Constitution as originally understood where a mere numerical majority in some branch of the federal government can do as it pleases. 

Even today, three-fourths of the states can amend the Constitution—that is, they can abolish the Supreme Court or the income tax, or even dissolve the Union. In no other way can we say the sovereign people have spoken their final word. States rights is the American government, however much in abeyance its practice may have become. 

The alternative to state sovereignty, as Calhoun pointed out, is to allow the final say-so to the black-robed deities of the Court, who go into their closets, commune with the gods, and tell us what our Constitution means and what orders we must obey, no matter how absurd their interpretation may be. 

But this is to abandon the sovereignty of the people, that is, to abandon democracy or republicanism and to abandon constitutional government for oligarchy—and an oligarchy based upon mystification rather than reason. The sovereignty of the people, in which we all believe, can mean nothing except, purely and simply, the people of each state acting in their sovereign constitution-making capacity. 

The question is not altered by the fact that the Union has been expanded to fifty states. The Founding Fathers wisely made the Union expansible. The Congress may admit new states (or not). But the federal government does not create a state. States create themselves. This is as true of the new states as the old, of Montana as of South Carolina—if we believe the people are sovereign. 

However wildly irrelevant it may seem today, the idea of states rights was a given to our forefathers. Centralizers were always on the defensive and always compelled to conceal their intent. The United States were universally spoken of in the plural. It was clearly understood that the Bill of Rights meant the states binding the federal government to stay out of certain areas. ("Congress shall make no law....") 

The states rights interpretation of the Constitution is a living heritage of great power, absolutely central to the understanding of the American liberty. Lost and stolen as the idea may be, American history cannot be understood without it. 

The only way to preserve civil liberty is to check government power. The only way to checkpower is to disperse and divide it. The federal government will never check itself. That is the purpose of federalism. It must be checked by the states. And this ultimately is of no avail unless it is backed by the right of secession. Curiously, recognition of the right of secession often obviates its use, because where it is a real possibility, Power is motivated, has incentive, to check itself and be responsible. 

States rights has fallen into disuse not because it is unsound in history, in constitutional law, or in democratic theory. It remains highly persuasive on all these grounds to any honest mind. It has fallen into disuse because it presented the most powerful obstacle to the consolidation of irresponsible power—that "consolidation" which our forefathers decried as the greatest single threat to liberty. 

For that reason states rights had to be covered under a blanket of lies and usurpations by those who thought they could rule us better than we can rule ourselves. At the most critical time, the War Between the States, it was suppressed by force and the American idea of consent of the governed was replaced by the European idea of obedience. But force can only settle questions of power, not of right. 

States rights are historically sound, constitutionally sound, ethically sound, sound from the point of view of democracy. Where they fall short is simply in the realm of political will. For a long time now, a century at least, the course of history has been moving in the direction of "consolidation," the gathering of concentrated power in one central, irresponsible, imperial government. 

That can change. The people of the states have the right to protect themselves against an out-of-bounds federal government and to determine when the proper bounds have been passed—to interpose their sovereignty, as Jefferson said, as Madison said, as Calhoun said. 

We now see, all over the Western world, a ferment of people against consolidation, in favor of regionalism, devolution, secession, break-up of unnatural states, the return to historic identities in preference to universal bureaucracies. There is reason to believe that the consolidation phase of history may be coming to an end. 

We may be ready for a new flowering of freedom for families and communities. The great periods of Western history have not been those of powerful states but of multiple and dispersed sovereignty—flourishing liberty for small communities. We know that such freedom equals creativity in wealth, art, intellect, and every other good thing. And we now have an asset the Fathers did not, the great comprehensive wisdom of the Austrian School of economics, which is federal in its essential spirit. 

All over the Western world people are thinking again of liberty—the most characteristic and unique of Western values—are doubting the central state that has been worshiped since the French Revolution. 

It would be a shame if, in this world-historical time of devolution, Americans did not look back to an ancient and honorable tradition that lies readily at hand. To check power, to return the American empire to republicanism, we do not need to resort to the drastic right of revolution. 

We have in the states ready-made instruments. All that is lacking is the will. Our goal should be the restoration of the real American Union of sovereign states in place of the upstart empire under which we live.


Cite This Article

Wilson, Clyde. "Toward Real Federalism." The Free Market 13, no. 8 (August 1995).