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State and Local Government Law
University of Texas Law School
Baker, Lynn A.

FEDERALISM AND DEMOCRACY
 
State and Fed relationship
·         Theories
o    Civic republican/communitarian – -. Local govt should be focal point for democracy. Only area where individuals can have meaningful role
o    Wellfarist allocation of goods and services better provided by govt than mkt
o    Public choice/economic – government officials are people motivated by the same rational self- interests- elected official, would like to be reelected, in order to do that they need to be responsive to constituents wants. Represents ppl coming together an aggregating preferences for goods/services
§ Problem 1- we don’t always want majority will directly enacted. Officials need to filter it
§ Problem 2 – voters =/= constituents
·         Problems govt can solve
o    Coordination problems – i.e. overcoming collective action, prisoner’s dilemma- uncertainty as to what the other party will do. Government can place certain standards, no uncertainties, Provide solution to occurrence of games, Avoid holdouts
o    Provide public goods, which in perfect form are nonrival/nonexcludable
o    Force internalization of externalities
o    Provide better information
·         What level
o    obtaining economies of scale – whats better local or central-. Example: FDA-
o    finding median voter (Madison factions)
o    finding better qualified representatives (Mill)
o    need for uniformity of laws in certain areas – environmental laws, drivers license(more dangerous commercial vehicles handled by fed instead of state)
o    the need for one voice (e.g. foreign affairs)
o    need to take outside interests into account(eg school finance)
o    need for redistribution – easier to redistribute over larger area
§ people move to capture benefits and escape burdens
o    John Stuart Mill- Leave policy to fed, details/implementation to local. Pay attention to externalities
o    -opposing groups will address the level of govt they can best influence
§ which level of govt is best at allowing all sides to be heard on the particular issue? (ie to create leg that best serves public interest)
·         Local govt as provider
o    Allocative – which goods produced. Market should handle this but:
§ Initial distribution of resources might not let people make bids for things they value
§ Externalities – transaction fails to reflect all costs/benefits it generates
§ Tragedy of commons
§ Free rider problem – public goods underproduced. Marginal cost = 0 so doesn’t signal. Often nonexcludable .Nonrivalness. Strategic behavior – conceal preference Game theory >Prisoner’s dilemma >Counter – repeat players
§ Information problem
§ Coordination is difficult
o    Distributive – redistributing resources
§ Better to centralize
§ People try to escape, poors gravitate
o    Govt solutions to coll action-Solve freerider problems by collecting fees, solve coordination by publishing etc
o    Criticisms of govt
§ Is itself a public good
§ Don’t always need intervention to solve collective actions
§ Officials might misunderstand/ignore prefs
§ Preferences might not be appropriate
o    Special interests – when cost dispersed but benefits conferred on small #, they will lobby to get things not in public good passed
o    What govt should solve – The one with boundaries that most closely match misallocation
o    Signaling problems /democracy failures
§  some people may not have much voice (poor/minority/can’t lobby effectively. Law can be effective in reducing the signaling problem
§ officials may not respond to signals b/c they aren’t publicly interested or because they can’t implement them
§ can’t vote single issue
§ low turnout
§ limited choices
§ elections have limited reach, even throwing ppl out of office won’t change buerocracy.
§ Problems capturing intensity of preferences
§ Prisoner’s dilemma – have to go for pork
§ Cycling/ordering preferences
§ Limited time horizon of public officials
§ People without strong preferences may vote on something because they are already at the ballot box
o    Frug – 351 – public goods are either nonrival or nonexcludable. Most city services don’t match these characteristics though, so the debate becomes what imperfect public goods should local govt provide.
§ -tiebout ignores that ppl don’t shop for city the way they shop for goods
·         -one person one vote is replaced by one dollar one vote that favors the rich
·         -assumption that people move based on “tastes” is wrong. Nobody prefers bad schools.
·         -tiebout makes decision between “citizens” and “consumers” disappear
 
Advantages/disadvantages of direct democracy (F97)
-beware elite control. When DD becomes intangible, ppl feel reduced responsibility b/c of rep govt, which causes less participation and knowledge of issues
-DD- pol participation by giving voice, single issue votes, public check on leg, signals preferences to leg
-fear that DD may not protect minority interest is unfounded. Rep govt may not better protect b/c of vote trading(can increase/decrease welfare, minority groups can gang up on each other). DD does not always result in more “hate” issues put on ballot. States hat provide for DD are often more liberal and more protective of minority rights. Larger majority could cut down on disc pro
-disadvantages – pure majoritarian. Doesn’t register intensity of interest like leg process, so issues harmful to minorities but moderately beneficial to majority can win. DD isn’t subject to deliberation, compromise, checks on minority issues.
-Mill/Madison – masses are ignorant/cant be trusted with making reasoned/knowledgeable decisions about politics (but these are same ppl who elect reps)
-DD may not necessarily mean more participation(low turnout on props). Special interest groups may decide for those who don’t care (but all voting works this way and if ppl don’t vote they shouldn’t care about outcome. Public is uninformed about issues from short articles and can’t consider nuance. Public can’t deliberate/compromise/vote trade, lack legislative expertise
-Checks – dd only a supplement, leg process takes care of most laws. Leg can be free to repeal what public enacted. State and fed con can void disc laws. Many con/statutes prevent some subjects from dd vote.
 
 
 
 
 
 
 
 
Advantages of Centralization
·         Believed in the tyranny of the majority and that because the passions of the day will control the law, the majority will enslave the rest of the people (fed 10)
·         Economy of scale
·         Externalities
·         redistribution
·         Greater Competency of officials – more to choose from (fed 10)
·         Guards against factions (fed 10)
o    But what about large interests that can better organize a

between State/fed
·         National league of Cities -1976
o    Fed cannot interfere with integral governmental functions, Traditional governmental functions, Functions essential to existence of states
o    4 prong test for immunity from federal regulation:
§ 1. Is the fed regulation seeking to “regulate the states as states”
§ 2. Does the federal regulation address matters that are indisputably attributes of state sovereignty?
§  3. Does federal regulation directly impair states ability to structure integral operations in areas of traditional governmental functions.
§ 4. Does the nature of the federal interest being asserted justify state submission
·         Garcia
o    overruled Nat’l League of Cities as unworkable and got out of the 10th amendment protection business (if congress passes it must be related to commerce)
o    Ct says cant distinguish between governmental functions and what should be protected.(third prong). Court would be making policy choices on what to protect/not protect. Sovereign interests better protected by structure of govt than judicial limitations on federal power. Courts basically quit
o    Structure- ct says in Garcia states don’t need protection from judiciary, are protected by fed structure
o    – Weschlers – – political safeguards are enough to protect states
§ States are not oppressed look at $ receive from federal gov’t
·         But it is just the return of their own money
§ States have rep in senate – senators are the ones who make laws and states are repped. So ct is on its weakest ground in opposing (minimalistic)
·         Baker – but the senate is most likely to be abusive because majority of states are overrepresented.. wealth systematically redistributed
o    kramer – protect political parties and they will protect states
§ Baker – But political parties aren’t in constitution (competition can still protect against homogenizing legislation though)
o    Kramer – things have worked fine for 200 years – rational basis in place of CC
§ Baker – but when would rational basis invalidate a law?
o    Horizontal vs. vertical protection
§ Vertical – in Garcia concerned that states are protected from fed gov’t . fed govt increasing power at expense of states
§ Horizontal – baker is concerned states arenn’t protected from each other
·         Punish minority
·         Capture excess of fund
·         Avoid responsibility for regulating at state level
o    Dissent – state’s role is matter of constitutional law, not legislative grace
§ Senators are part of fed govt once elected
§ Federal officials are being made judges of limits of their power
§ Fed admin officials not elected, don’t know about local issues