High-Speed “Federalism” Goes Off the Rails

The Washington Post reports that federal-state plans for a high-speed train connecting San Francisco with Los Angles and points in-between may never come off the ground. In the face of public resistance, the state may have to decline some $3.5 billion in federal “stimulus” funds dedicated to an initial segment of the line, connecting the thriving metropolises of Bakersfield and Merced. We may be witnessing an outbreak of fiscal and institutional sanity.

Federal funding programs replicate, on a daily basis and an increasingly alarming scale, a debility that Alexander Hamilton identified as a constitutional problem.  State officials, he wrote in Federalist 1, will seek to maximize to “the power, emolument, and consequence of the offices they hold under the state establishments.” Officials’ time horizon extends over their expected tenure (at most, their lifetimes); thus, they would never support a Constitution that is calculated to produce long-term collective gains. They would have to be beaten, as mercifully they were.

Federal grants programs systematically exploit state officials’ constricted time horizon for the expansion of government at all levels. So long as federal grants promise immediate electoral gains, state officials will discount even ruinous long-term costs to zero: “Take the money and run” (often, for higher office) is the rational course of action. From the smallest earmark to the Medicaid monster (which consumes over 20 percent of states’ budgets), our entire fiscal federalism operates on this principle.

California Governor Jerry Brown is still committed to the high-speed train fantasy. However, his failure to explain where the estimated $100 billion for the project might come from has generated public resistance. California seems bound to do what Ohio, Wisconsin, and Florida have already done: say “no” to the federal funds.

This epidemic of good sense has an obvious source: unsustainable debt levels at all levels of government—in no small measure, a consequence and legacy cost of federal transfer programs—have produced a more realistic calculus. The issuance of yet more state debt tends to alarm voters, and assurances that the feds will agree to make up any future shortfalls or even make good on their commitment produces guffaws: they don’t have the money.

Our officials have driven fiscal federalism into a wall. A few have begun to walk away from the wreck, and that’s a start. What the country needs is a stampede.

Reader Discussion

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on January 23, 2012 at 08:07:54 am

I just added this feed to my bookmarks. I have to say, I very much enjoy reading your blogs. Thanks!

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on February 01, 2012 at 23:34:48 pm

Great post!

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Tory Badua
on March 05, 2012 at 23:28:30 pm

This Constitution, and the Laws of the United States which shall be made in pursuance teherof; and all treaties made, or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the judges in every state shall be bound thereby, anything in the constitution or laws of any state to the contrary notwithstanding. Article VI, clause 2. We scholar types call it the Supremacy Clause.However, this isn't directly relevant here. The Patient Protection and Affordable Care Act of 2009 ( Obamacare if you don't like it) has *already* been passed with these requirements. Any restaurant that met the PPACA requirements and didn't post calorie counts would be violating a *federal* law. So they would be dealt with in federal court and, if necessary, the judgment would be enforced by the U.S. Marshals Service, a federal agency. The state would have no power over it, and the feds wouldn't care one way or the other about a state-issued business license.(BTW, I hope you aren't the same fellow who kept asking about if states decided to ignore Roe v. Wade. He or she asked the same question about every three hours for a week.)

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Law & Liberty welcomes civil and lively discussion of its articles. Abusive comments will not be tolerated. We reserve the right to delete comments - or ban users - without notification or explanation.