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Will States Restrain the Federal Government? February 15, 2009

Posted by federalist in Federalism, Taxation.

The United States Constitution reserves all powers, not explicitly delegated to the federal government, to the states and the people.  Since each state is a sovereign entity, why do they tolerate such an enormous federal government?

A state government has real incentives to resist the encroachment of the federal government: Every dollar that the feds take in taxes is a dollar that the state can no longer use for its political purposes.  The feds can take that money and redistribute it for the benefit of other states.  Or the feds can use it as a “carrot,” only remitting the tax revenue to states when they comply with the wishes of the feds.  Either way, federal taxation takes power away from the states.  But the Constitution clearly gives states the authority to retain this power, except insofar as the federal government is spending it on a very limited set of enumerated activities.

If there was any doubt before, the recent “bailout” plans show the federal government plainly exceeding its enumerated powers.  Mark Sanford, Governor of South Carolina, is asserting that point, and suggesting that his state should not take any of this money.

The Pennsylvania state legislature is also considering a resolution that would “put the federal government on notice,” and serve as a preamble to repealing all extra-constitutional federal laws and taxes.

So long as the federal government is taxing and spending outside of its enumerated powers, the states would be justified in nullifying the taxation and prosecution of their citizens.  It would be quite easy for a state like South Carolina or Pennsylvania to simply announce that it is indemnifying its citizens against the claims of the IRS.  If the federal government threatened to send agents into a state to forcibly collect unjust taxes or imprison citizens who did not pay them, the state could not only call out its sheriffs and militia to defend its citizens, but it could also appeal to other states or countries for assistance in maintaining its sovereignty.  If the federal government tried to impound assets held outside of that state, the state could seize the assets of the federal government or its beneficiaries for recompense.

In practice, because the states are in fact sovereign entities, and because the federal government is in fact constitutionally restrained, it is likely that the mere assertion of a state’s rights would be sufficient to put the federal government back in line.  Governor Sanford: It only takes one state to start!

Addendum: California could easily extract itself from its present financial crisis in this manner.  Governor Schwarzenegger just has to tell Californians, “Pay your taxes to California.  We’ll take care of the feds.”  If its taxpayers remanded even half of their federal taxes to the state instead, California would take in roughly $150 billion extra per year.  Its current budget is roughly $100 billion per year, and its current deficit is less than $20 billion, which would leave the state with ample cash to make up for extra-constitutional federal services it wants to continue, to pay any constitutional taxes owed to the federal government (which would primarily be an apportionment for national defense), and to fight any attempts by the federal government to infringe its sovereignty.  Since California is such a nanny state to begin with it wouldn’t have to scramble to build government infrastructure to collect these additional taxes and provide “essential” government services.  And wouldn’t every citizen there jump at the opportunity to cut their tax burden and shore up their state in the process?

There could be a big first-mover advantage to this, since the first state to cut federal taxes will enjoy a rapid influx of industry and productive citizens looking for a break.

[See Dave Nalle’s 17Feb update on these efforts across the union.]



1. stophate - February 16, 2009

So you are advocating the armed overthrow of the federal government ?

2. federalist - February 16, 2009

Certainly not. I am advocating the peaceful and constitutional return of power to the states.

I only introduced the question of force to emphasize the fact that states retain sovereignty and are justified in asserting that. In practice, since all federal officials and agents swear an oath to support and defend the U.S. Constitution, I think it is not likely that the federal government would actually employ force to subjugate a state that decided to assert the sovereignty guaranteed under the constitution.

Or, put another way, it is he who advocates the use of force to prevent states from asserting their sovereignty who is proposing the armed overthrow of the constitutional government.

3. Dave West - February 16, 2009

Excellent explaination. This kind of discussion should be on the front pages of our newspapers and front and center on eery Congress Critters desk.

4. federalist - February 17, 2009

Looks like there is actually a significant number of states engaged in this, as described by Dave Nalle. Ongoing updates seem to be accumulating here and here. Granted, a legislative resolution is a very small first step, but it’s something….

5. Mike - February 22, 2009

That’s rather an interesting interpretation, given that the Amendment does not specify powers specifically delegated…

6. federalist - March 4, 2009

David Boaz at the Cato Institute quotes Frank Chodorov:

The Sixteenth Amendment corroded the American concept of natural rights; ultimately reduced the American citizen to a status of subject, so much so that he is not aware of it; enhanced Executive power to the point of reducing Congress to innocuity; and enabled the central government to bribe the states, once independent units, into subservience.

(My emphasis.)

7. federalist - March 25, 2009

Walter Williams notes Colorado’s 1994 plan to put teeth in its sovereignty act:

In 1994, the Colorado Legislature passed a 10th Amendment resolution and later introduced a bill titled “State Sovereignty Act.” Had the State Sovereignty Act passed both houses of the legislature, it would have required all people liable for any federal tax that’s a component of the highway users fund, such as a gasoline tax, to remit those taxes directly to the Colorado Department of Revenue. The money would have been deposited in an escrow account called the “Federal Tax Fund” and remitted monthly to the IRS, along with a list of payees and respective amounts paid. If Congress imposed sanctions on Colorado for failure to obey an unconstitutional mandate and penalized the state by withholding funds due, say $5 million for highway construction, the State Sovereignty Act would have prohibited the state treasurer from remitting any funds in the escrow account to the IRS. Instead, Colorado would have imposed a $5 million surcharge on the Federal Tax Fund account to continue the highway construction.

8. federalist - March 30, 2009
9. federalist - April 22, 2009

Historical Notes: The first assertions of state sovereignty occurred early in the history of the United States: Jefferson authored the Kentucky Resolutions and Madison wrote the Virginia Resolution. One generation later was the notable South Carolina “nullification crisis.”

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