High Time to Ask Again: What Are States Good For?

Michael S. Greve has written a thought-provoking but flawed book on federalism, the “’oldest question of American constitutional law’” (p. 2). In his favor, he does add to constitutional thought by asking readers to scrutinize justifications for federalism anew and by perceptive criticisms of related judicial doctrines. He justifies the book’s length on the ground that “we have forgotten an awful lot—and find ourselves in dire need of remembering it” (p. 17). Yet the book does not make a substantial contribution to historical knowledge, and the bowdlerized history it does offer has important shortcomings. At critical points, his analysis conflates economic theory and constitutional law. His conclusions on nineteenth century federalism’s politics sharply undermine his main thesis attacking New Deal developments.

Greve’s book is not intended as a conventional “true and correct” history of American federalism, but as an “analytic narrative” (p. 178).¹ The words freedom, liberty, and sovereignty do not appear in its index. He argues that it is misguided to follow the traditional view that the proper goal of constitutional federalism is to balance properly the rights of the federal government and those of the states. Instead, the book combines insights drawn from a series of disciplines—political science, public choice economics, and constitutional history and theory—to make the case that the “bedrock” of the Constitution’s original structure was a commitment to “competitive federalism” and that Americans would be better off if the Supreme Court returned to those principles in interpreting the Constitution (p. 2). Competitive federalism “aims to discipline government at all levels, and it aims to curb factional politics and, in that fashion, to produce political and institutional stability” (p. 2). By “discipline government,” Greve apparently means that governments would be forced to compete with one another for mobile citizens’ adherence by offering public services at the lowest possible cost, and perhaps by providing diversity of choice regarding the extent of social rights. He contrasts competitive federalism with “cartel” or “consociational” federalism, which he is says is what states acting as states would want. They seek a means of enhancing their ability to tax their citizens “in excess of the cost of providing public services,” or of specifically protecting their share of public resources by law (p. 4). Greve claims that states are often potential greedy revenue maximizers, not disinterested champions of public liberty and local community values against centralized tyranny.

In the first three chapters, Greve begins by asking readers to consider what kind of federalism individual citizens would have wanted if they were designing the Constitution. He argues that they would have chosen a competitive framework, one that does not guarantee “any end-state distribution at all” (p. 27). Greve concludes that Federalist 10, if taken seriously, means that there should be no states, and that that was James Madison’s and Alexander Hamilton’s original position (p. 45). He claims that, in the Constitution, Madison and Hamilton sought to create a competitive federalism, essentially as a second-best alternative to abolition. He focuses extensively on the 1787 Constitutional Convention’s treatment of Madison’s unsuccessful proposal for a general veto over state laws, which was his solution to controlling the states. Greve claims that the provisions of the Constitution that emerged from the defeat of Madison’s veto proposal—enumerated powers, prohibitions on state exercise of certain powers such as printing paper money, and federal supremacy—are “the bedrock of a profoundly competitive federalism” (p. 58; italics original). It is unsurprising that the Constitution commits enforcement of these provisions to the judiciary, since, unlike Congress, the judiciary can be trusted to enforce them (p. 87).

Greve’s idealized account of the Constitution’s formation creates a series of tensions. He concedes that Madison’s thought did not represent a “Founders’” consensus, and that, as a result, there are permanent “ambiguities and tensions” built into the Constitutional structure on federalism issues (pp. 49–50...