Covering the Front and Back Pages of the Newspaper
September 8, 2002
LAW/POLITICS: Federalism's Edge, Part I
FEDERALISM is often thought of -- principally by its critics on the Left, but by some fairly zealous conservatives as well -- as synonymous with "States' Rights" as against a powerful federal government. That's a big part of the picture, of course, but it's not the whole story. There's also what I call "Federalism's Edge" - the right of the states to be free of overweening influence by other state governments that seek to impose their public policies on the rest of the nation. After all, a distant and intrusive setter of national policy is no less obnoxious if it's set in Montgomery' Alabama than inside the Beltway. More so, since at least there are SOME mechanisms for controlling Washington.
Federalism's Edge, as much as States' Rights, has been one of the hottest issues of the past decade or so. Whatever you think of the merits, can one state cram gay marriage down the throats of the country? Can one state's Supreme Court decide who gets to be President of the rest of us? Can one or a handful of State Attorneys General, or juries in a few tiny jurisdictions, prescribe codes of conduct for nationwide businesses?
Liberals have long bemoaned what they see as the opposite problem, the "race to the bottom" where states compete to LOWER regulatory burdens, although at least there there's market forces at work rather than ironclad mandates. This is where Jonathan Chait's assault on Delaware, after the fashion of Jonah Goldberg's French-bashing columns, comes in. Personally, from my experience as a business and securities litigator, I think Chait doesn't know much about Delaware's court system if he thinks it's apt to be lax in imposing liability on corporations and their management. But there's an interesting point here: is it inconsistent with Our Federalism for one state to create conditions for what is effectively a national corporate governance regime? And does it say something that corporations seem to WANT the efficiency and stability provided by such a regime?
PART II of this comment to follow later.
Posted by Baseball Crank at 9:26 AM | Law 2002-04 | Politics 2002-03 | Comments (0) | TrackBack (0)