Federal vs. State: The Battle for Economic Powers

This segment comes from the request of one of my readers markfadden. He (and I assume it's a he based on the name, if you're a she I would apologize but that's what you get for having a screen name that just screams "I'm a man") suggested I look into an article called "The Breakup of the United States" which can be found by following this link: http://www.lewrockwell.com/rozeff/rozeff328.html

I don't want to get too much into the article as I think it is something everyone should read as well, but for the purposes of this blog I will give a quick summary. The article talks about the economic crisis that we are in (yes, we are in a crisis who knew?). The author focuses on the idea that a lot of the crisis exists because of decisions and moves our federal government has made. I personally agree with this idea as do most Americans I feel. Anyway, he goes on to discuss the possibility of a shifting of power and control to the states rather than the current system we are in. As per markfadden's request, here is my opinion. Thanks for the request and I encourage others to ask or request any topic they wish me to discuss as well. Just leave a comment on one of the posts. Bare with me on this one, it starts off political but ends on pure economics I promise.

I remember the simple times. The times we were young, taught something and were able to take it as fact. Those years in elementary school where we learned about checks and balances, a free country with free markets and democracy. A time when I was told that's what America is and could accept it as fact. But as we age we realize, our third grade teachers do not know all, the world is not full of candy and rainbows and the federal government is not this agency doing anything and everything it can to help out its people. I am not sure when the federal government amassed the power it has now and when states became simply a place to closer identify what part of the country you live in.

America is a HUGE place, third largest in the world by population and by area in fact. A large area for a government to rule all the economic decisions that take place. Once upon a time the leaders of this country understood this and delegated power and control to states so that we could all live the most prosperous lives possible. However this is no longer the case. Every day there is a new federal bill proposed that seeks to govern our rights and the economy of this country. Right now there is this "fantastic" idea of cyber security (formally known as net neutrality). A way for the federal government to control the Internet. It would grant large businesses sole power of where bandwidth is directed and even give a "kill switch" if the president decided the Internet needed to be shut down. Now I am not sure what situation would require that, perhaps "Rickrolling" staged a national comeback or Paris Hilton's blog started to gain readership. However, I don't know about you, but I still find the occasional "Rickroll" funny and I don't think Paris knows how to even turn on a computer, let alone post a blog that people would read so I am pretty sure we're safe.

On to my point. Currently we have a small group of people in the federal government controlling more people and area than they can even begin to handle. Bills are 20,000 pages long (not an exaggeration either, look it up) because the have to encompass all of the states but the federal government has no idea whats actually going on in a majority of our lives. Picture it like this. The federal government is our grandparents. Without them we would not have our parents and thus we would not exist. They are a necessary step. However, the closer relationship is that of us to our parents, the parents representing our state government in this scenario. My question is: Who is more likely to know about the fine details of your life, the people who you live with and raised you or the people you see a few times a year? Who would be better at making decisions to really help you flourish and expand on everything that you have going? The grandparents are older, they may have more wisdom but the do not know the intricacies or all the situations going on in your life.

We currently have 50 states in this country (I know, I counted) which means we have 50 individual groups of government set up to help the group of people within their borders. Why? Because those governments know what their people need, they live with them, pay the same taxes, deal with the same social issues, eat the same food, drink the same water, breath the same air. People in Maine do not have a full grasp of what its like in Texas or Hawaii, nor does the federal government. Each state is different and deals with different economic issues.

I grew up in Michigan, home of the automotive industry, iron ore mines and logging. The economy there in no way relates to that of, say, Texas. I don't know about you, but I think someone from Michigan would be more adept at running its economy than someone from Texas who knows the oil industry and cattle farming. "Hey Bill, cars ain't sellin, think we should start cutting down the trees and raising some longhorns?" is not the best way to go about dealing with the economic crisis in my home state.

One of the ideas in "The Breakup of the United States" is that of nullification. To learn more about it check out a book under the same name written by Thomas Woods. Basically nullification is a right of a state to refuse to recognize or enforce federal legislation within its borders. In other words, states could go back to running themselves in the way they best see fit. Unfortunately it is seen as a radical step despite being completely legal. Many states fear the backlash that they would draw from the federal government if they chose to enact it. I personally think it's a fantastic opportunity that certain states should be taking advantage of. I mean how much more suffering do places like New York, Michigan, and California have to go through before the people make a stand?

To be clear many people think that we are on the verge of financial collapse. They believe that within a mere year or two we could become bankrupt and be the next Greece. Here's a word of comfort, that's not going to happen. Don't get me wrong, we are in trouble, serious trouble. We are in a downward spiral that will take same serious digging to get out of. However we remain one of, if not the most important country in the world financially. If we had complete economic collapse the world economy would fall. Look at what the collapse of Greece did to the world economy and that was just Greece. The world cannot afford to let the United States go into chaos and turmoil because it would mean their downfall as well. I don't mean you can sit there and be comfy thinking our country will be the next group to get a bailout because while we will not completely collapse we can go into a deep depression. Things can get much worse before they get better and they are trending that way as we speak.

I do not think a complete dismantling of the federal government is necessary or even a good idea. In fact quite the opposite. A federal government is a necessity. However, it needs to be in a basic form. The economic decisions need to be left to the people who know them best, the states. The governments are already in place, they just need to be utilized. A state can decide for itself what the schools need, what needs to be done to fix unemployment and so on. If a state screws up people will move to a state that is flourishing. States are part of the free market. If a state has to compete for its citizens you know damn well that they will do whatever they can to attract people and bring in more money.

Power lies with the states. And in that power is at least a partial solution to the economic disaster we are currently enduring. If we can states to start utilizing the power they are granted by The Constitution an upturn is inevitable.