The founders of the U.S. Constitution could have created a unitary or confederal system, but instead they established a government based on federalism, in which some powers are held by the national government and some by the states; others, called concurrent powers, are held by both. Political scientists once held to a theory called dual federalism that considered the powers of the two levels to be separate and distinct but now understand their powers to be interrelated, a view known as cooperative federalism. The Constitution gives a decisive amount of power to the national government via the enumerated powers of Congress, which concludes with the necessary and proper clause and the supremacy clause.

Federalism reflects a continually changing compromise between advocates of a strong national government and advocates of strong state governments. The balance of power adopted between central and subnational governments directly affects the national government’s ability to act on large policy problems and the subnational units’ flexibility in responding to local preferences. Although power was concentrated at the national level for much of the twentieth century, recent decades have seen more emphasis on devolution—shifting power from the national level to the states—although this trend has slowed since the events of 9/11.

The growth of national power through much of our history can be traced to the early decisions of Chief Justice John Marshall, notably McCulloch v. Maryland and Gibbons v. Ogden; the constitutional consequences of the Civil War during which the southern states sought to declare federal laws void within their borders, an unconstitutional process called nullification; the establishment of national supremacy in economics with the New Deal; and the new national responsibilities in protecting citizens’ rights that have been associated with the civil rights movement.

Where states retain power, Congress can use authority and money to encourage state cooperation with its agenda in four ways: it can exercise no influence, letting states have their way; or it can issue categorical grants, giving states money in exchange for following specific instructions; block grants, giving states money in exchange for following broad mandates; or unfunded mandates, giving states no money but expecting compliance with national laws.