Posted by Ilya Somin:
Does Declining Identification with State Governments Undermine the Case for 
Federalism?
http://volokh.com/archives/archive_2009_04_12-2009_04_18.shtml#1239861517


   In their important new book criticizing federalism, Malcolm Feeley and
   Edward Rubin argue that federalism (defined as constitutional
   guarantees for state autonomy) is unnecessary in the modern US in part
   because modern Americans no longer feel any major sense of
   identification with state governments. Feeley and Rubin concede that
   federalism might be a useful institution in societies where state
   boundaries coincide with major ethnic or religious divisions. For
   example, Canadian federalism allows the French-speaking minority to
   have an autonomous enclave in Quebec, where they can avoid domination
   by the English-speaking majority. French-speaking Quebecers identify
   with Quebec as much or more so than with the Canadian federal
   government. By contrast, Feeley and Rubin claim, most modern Americans
   identify as "Americans" first and foremost and have little or no
   loyalty to their states. I live in Virginia, but I feel no meaningful
   attachment to the state government in Richmond. My loyalty to the
   state of Massachusetts (where I grew up) is expressed primarily by
   rooting for Boston sports teams.

   With a few exceptions such as Mormon identification with Utah and
   native Hawaiians' affiliation with Hawaii, Feeley and Rubin are
   largely correct in concluding that modern Americans feel little
   loyalty to their states. But they are wrong to claim that this
   undermines the case for federalism. Indeed, in one important respect
   it actually strengthens it. As I have discussed in various articles
   (e.g.[1] here and[2] here), one of the main benefits of federalism is
   interjurisdictional competition. States compete with each other to
   attract taxpaying workers and businesses; this competition gives them
   incentives to adopt good policies that will be appealing to the
   population, and also promotes desirable innovation in public policy. A
   state that makes a beneficial innovation will have a leg up on its
   competitors. The ability of citizens to "vote with their feet" is one
   of the main advantages of federalism. Obviously, foot voting is
   difficult or impossible in a situation where there is a unitary
   federal policy that applies to the whole country. In that situation,
   we can only vote with our feet by leaving the United States entirely.

   As John McGinnis and I explained in [3]this 2004 article, declining
   public identification with state governments actually increases the
   benefits of foot voting. A citizen who strongly identifies with
   Virginia, might hesitate to leave even if another state is otherwise
   vastly more attractive due to its superior public policies. But a
   person who feels little or no loyalty to her state won't suffer from
   any such inhibitions. To the extent that modern Virginians are more
   willing to leave than those of 100 or 200 years ago, state governments
   elsewhere have stronger incentives to woo them, and Virginia's state
   government has stronger incentives to adopt good policies that will
   convince them to stay. Once we recognize the importance of voting with
   your feet as a major benefit of federalism, it turns out that
   declining loyalty to state governments actually strengthens the case
   for limiting the scope of federal power.

References

   1. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=578143
   2. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=457760
   3. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=578143

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