Wednesday, August 31, 2011

"Cooperative" or "Forced" Federalism? ... No Child Left Behind and ObamaCare

A heavily bipartisan congressional majority enacted No Child Left Behind (NCLB) legislation in 2001, and congressional Democrats passed ObamaCare in 2010.

These acts of Congress are similar in several important respects as each concerns the proper roles of the national and state governments concerning health care insurance and public education. Both of these areas traditionally have been viewed to be within the purview of individual states and not that of the national government.

So let's take a closer look at what this means in a broader sense for all of us. Under the Constitution, "We the People" delegated certain powers to the federal government. At the same time, we reserved to the states and the people (Tenth Amendment) all those powers not granted to the national government. At least that's what we wanted to do, and for a time that's pretty much the way it worked.

Of course, health care and education were not deemed to be among those powers granted to the federal government. Common sense and our country's long history would suggest that individual states and localities are the proper places for such governance. In this regard, most people understand intuitively that insurance and education are properly state and local matters. This is simply the organizational principle of subsidiarity being applied, meaning that decisions are best made at the lowest competent level of any organization, including government

If only it would have been kept as simple as it started out to be, NCLB and ObamaCare wouldn't exist. Sadly, it's developed over time into something else completely, so let's continue our discussion in order to better understand the issues involved.

Our Government and Economics class is currently studying federalism. One descriptive term under study is a concept called "cooperative federalism." In part, here's what the textbook says on page 75, "cooperative federalism is often used to describe the relationship between the state and national governments that developed to administer much of the reform legislation passed during the 1930s and the following decades. Cooperative federalism is based on the recognition that not all problems are best solved by concentrating authority in Washington. This new view of federalism also recognized that the states lacked the financial ability to pay for the social welfare programs that the public demanded."

My view is that his assessment is both incorrect and misleading. Neither the federal government nor the states has a blank check from the citizens to pay for unlimited federal programs. Or state programs either. Besides, the public wasn't "demanding" NCLB and/or ObamaCare.

In my opinion, what the textbook's author calls cooperative federalism would be better labeled "forced federalism." What the Congress has been doing ever since the Depression era, albeit in a most clever manner, has served to bribe or otherwise coerce the individual states into going along with the federal initiatives, regardless of whether the individual states wished to do so. If any individual state chooses not to "go along to get along" with the feds, the fiction of cooperative or forced federalism instead sends the federal subsidy money to those remaining states who do choose to "voluntarily participate." Some freedom of choice that is!

So let's more fully consider forced federalism using the specific examples of NCLB and ObamaCare. In order to avoid taking sides politically, we've chosen separate Republican and Democrat initiatives for our discussion.

NCLB was passed by Congress overwhelmingly with bipartisan support in 2001. President Bush sought and won approval to set standards and measurements to improve public school education and outcomes. The national legislation requires assessment in basic skills to be given to students in certain grades, and if the state doesn't "choose" to participate, it is ineligible to receive federal funding for public schools. The achievement standards are set by each individual state, and to my knowledge, while most states have "dumbed down" the meaning of test results, there has been no meaningful improvement in real student performance over the years. But the governments did succeed in one respect-- they spent the additional monies allocated to the program.

In a similar vein, Congress passed ObamaCare (aka the Patient Protection and Affordable Care Act of 2010), and its many provisions in 2010. Health Care Puts Governors in Pickle explains the rather huge dilemma now facing many Republican governors opposed to ObamaCare. That is, the salient question confronting each governor is the following: "Do they apply for millions of dollars in federal grants by September to begin establishing state-run health insurance exchanges, or let the deadline slide, lose the federal money and risk falling into a federally run exchange?"

{For a discussion of the law's constitutionality with respect to the individual mandate requiring the purchase of insurance by individuals, see our posting dated Tuesday, August 23.}

In other words, governors and states opposing ObamaCare are absolutely between a rock and the proverbial hard place. They certainly want the courts to declare the law unconstitutional, and they also want to elect a president in 2012 who would work to repeal ObamaCare if the courts decide the law is constitutional.

But what if neither happens? Should the states apply for and then take the federal subsidy money? Should they now proceed to adopt a state-run insurance exchange, or should they refuse the federal subsidy being offered because of the strings attached thereto? If any state opts not to take the federal money, it will then go to those states who do "choose" to establish the law's required state-run insurance exchanges.

As the editorial puts it,"The exchanges are the centerpiece of the 2010 health care law, designed to be government-run marketplaces where private insurers would compete to offer health plans to the uninsured and to small businesses at rates subsidized by the federal government. House Democrats and the White House wanted a single national exchange, but senators insisted they be operated by the states. The exchanges are to be running by 2014. But if a state has not made substantial progress by Jan. 1, 2013, the federal government will step in."

Here's what all this says to me.

Our Constitution established a dual government structure which became known as federalism. Some powers were delegated by the people to the national government, whereas others were reserved to the states and the people. However, cooperative federalism was created during the Depression years of the 1930s, and it has resulted in ever growing national government grants-in-aid to states and, therefore, an ever growing level of national and state spending.

Since we don't have the money that we spend, either at the national or state level, the result is that we borrow more and more, and our debt levels continue to climb.

My further view is that cooperative federalism is a fiction, and while perhaps an ingenious concept, it is contrary to the intention and plain meaning of the language of the Constitution. It's also inconsistent with the principle of federalism and subsidiarity, as well as sound financial management.

Perhaps the biggest lesson for us is that we elect the congress and the president. In the end, we'll get the government we deserve, and that government will bend to our political will. So will those who serve on the Supreme Court.

The powers of the national government have been allowed to expand greatly since the Depression years of the 1930s. But now it's time to reinstitute all those good ideas articulated so very well in the Constitution by the Founding Fathers. Pogo says it's time to speak up and speak out loudly, too.

Thanks. Bob.

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