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The system of checks and balances in our political system often prevents the federal government from imposing uniform policies across the country. As a result, states and local communities have the latitude to address policy issues based on the specific needs and interests of their citizens. The diversity of public viewpoints across states is manifested by differences in the way states handle access to abortion, distribution of alcohol, gun control, and social welfare benefits, for example.

The drawbacks of federalism

Federalism also comes with drawbacks. Chief among them are economic disparities across states, race-to-the-bottom    dynamics (i.e., states compete to attract business by lowering taxes and regulations), and the difficulty of taking action on issues of national importance.

Stark economic differences across states have a profound effect on the well-being of citizens. For example, in 2014, Maryland had the highest median household income ($73,971), while Mississippi had the lowest ($39,680).

See http://www.deptofnumbers.com/income/ for more data on household income.
There are also huge disparities in school funding across states. In 2013, New York spent $19,818 per student for elementary and secondary education, while Utah spent $6,555.
Governing. “Education Spending Per Student by State.” http://www.governing.com/gov-data/education-data/state-education-spending-per-pupil-data.html (June 24, 2015).
Furthermore, health-care access, costs, and quality vary greatly across states.
The Commonwealth Fund. “Aiming Higher: Results from a Scorecard on State Health System Performance, 2014.” http://www.commonwealthfund.org/publications/fund-reports/2014/apr/2014-state-scorecard (June 24, 2015).
Proponents of social justice contend that federalism has tended to obstruct national efforts to effectively even out these disparities.

The economic strategy of using race-to-the-bottom tactics in order to compete with other states in attracting new business growth also carries a social cost. For example, workers’ safety and pay can suffer as workplace regulations are lifted, and the reduction in payroll taxes for employers has led a number of states to end up with underfunded unemployment insurance programs.

Alexander Hertel-Fernandez. 2012. “Why U.S. Unemployment Insurance is in Financial Trouble,” February. http://www.scholarsstrategynetwork.org/sites/default/files/ssn_basic_facts_hertel-fernandez_on_unemployment_insurance_financing.pdf
Nineteen states have also opted not to cover more of their residents under Medicaid, as encouraged by the Patient Protection and Affordable Care Act in 2010, for fear it will raise state public spending and increase employers’ cost of employee benefits, despite provisions that the federal government will pick up nearly all cost of the expansion.
Matt Broaddus and January Angeles. 2012. “Federal Government Will Pick Up Nearly All Costs of Health Reform’s Medicaid Expansion,” March 28. http://www.cbpp.org/research/federal-government-will-pick-up-nearly-all-costs-of-health-reforms-medicaid-expansion
More than half of these states are in the South.

The federal design of our Constitution and the system of checks and balances has jeopardized or outright blocked federal responses to important national issues. President Roosevelt’s efforts to combat the scourge of the Great Depression were initially struck down by the Supreme Court. More recently, President Obama’s effort to make health insurance accessible to more Americans under the Affordable Care Act immediately ran into legal challenges

National Federation of Independent Business v. Sebelius , 567 U.S. __ (2012).
from some states, but it has been supported by the Supreme Court so far. However, the federal government’s ability to defend the voting rights of citizens suffered a major setback when the Supreme Court in 2013 struck down a key provision of the Voting Rights Act of 1965 .
Shelby County v. Holder , 570 U.S. __ (2013).
No longer are the nine states with histories of racial discrimination in their voting processes required to submit plans for changes to the federal government for approval.

The benefits of federalism are that it can encourage political participation, give states an incentive to engage in policy innovation, and accommodate diverse viewpoints across the country. The disadvantages are that it can set off a race to the bottom among states, cause cross-state economic and social disparities, and obstruct federal efforts to address national problems.

Beer, Samuel H. 1998. To Make a Nation: The Rediscovery of American Federalism . Cambridge, MA: Harvard University Press.

Berry, Christopher R. 2009. Imperfect Union: Representation and Taxation in Multilevel Governments . New York: Cambridge University Press.

Derthick, Martha, ed. 1999. Dilemmas of Scale in America’s Federal Democracy . New York: Cambridge University Press.

Diamond, Martin. 1981. The Founding of the American Democratic Republic . Belmont, CA: Wadsworth Cengage Learning.

Elazar, Daniel J. 1992. Federal Systems of the World: A Handbook of Federal, Confederal and Autonomy Arrangements . Harlow, Essex: Longman Current Affairs.

Grodzins, Morton. 2004. “The Federal System.” In American Government Readings and Cases , ed. P. Woll. New York: Pearson Longman, 74–78.

LaCroix, Alison. 2011. The Ideological Origins of American Federalism . Cambridge, MA: Harvard University Press.

Orren, Karen, and Stephen Skowronek. 2004. The Search for American Political Development . New York: Cambridge University Press.

O’Toole, Laurence J., Jr., and Robert K. Christensen, eds. 2012. American Intergovernmental Relations: Foundations, Perspectives, and Issues . Thousand Oaks, CA: CQ Press.

Peterson, Paul E. 1995. The Price of Federalism . Washington, DC: Brookings Institution Press.

Watts, Ronald L. 1999. Comparing Federal Systems . 2nd ed. Kingston, Ontario: McGill-Queen’s University Press.

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Source:  OpenStax, American government. OpenStax CNX. Dec 05, 2016 Download for free at http://cnx.org/content/col11995/1.15
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