Title- COOPERATIVE FEDERALISM: DESCRIPTIVE ANALYSIS THEORISING SCOPE AND

CHALLENGES

Name of author- Avinash Singh

Designation- Project Assistant (Research), Indian Institute of Management, Lucknow.

Qualification- BBA.,LLB (Constitutional law); LL.M (Corporate and commercial law)

Address- 21/334, Indira Nagar, Lucknow- 226016

E-mail- acd.avns@gmail.com

Contact- 9554655550
Abstract

Cooperative Federalism: Descriptive analysis theorising scope and challenges

Cooperative federalism has a deep root in the present world order as the globalization and
informed decision making has led to the economic condition enhancement in the regions that
were previously not obsessional to such growth. European Union and United States of America
were one of the forerunners of the economic shift in past decades and hence the nature of
federalism in those regions form the base of the global market economy at present.

Paper begins with the introduction to the cooperative regime of governance which
consequently associates several nations into a popular scheme that has tendency to negate
micro-economical conflicts and assist the smooth functioning of the macro-economic powers
in the country. Cooperative federalism has its international presence with multiple nations
joining the regime of which stimulating example was taken in form of country Spain and
stretching to various other transnational entities with a focus upon the Europeanization effect.

Cooperative federalism though is not left untouched without the challenges that have been
argued in the manuscript in depth, along with the downsizing effect that has taken place in
several jurisdictions around the globe. Also, the sectoral analysis of the cooperative federalism
was analysed in the paper wherein the energy sector, education sector along with others have
been introspected to guide the necessary outputs.

Therefore, in a nutshell, it could be perceived from the content that there may be a competitive
regionalism or competitive federalism existing as the governance model in a country, but to
survive a structured democratic setup, it is necessary to encourage the practise of the
cooperative federalism catalysing the democratic element in the governance and with the
interconnected socio-economic setup in place among major jurisdictions, wisest institutional
governance model must be practised along the lines of cooperative federalism.

Keywords: Cooperative Federalism, Economic, Internationalization, Governance,

Sectoral Perspective
 Extended Abstract

1- Introduction

Federalism in philosophy is defined as a relative indexing of the State’s power and relationship
between its subjects while featuring basic limitations to said power through other philosophies
of law and governance. Federalism thus provides a key contributory mechanism towards
securing the structure of governance in a country and thus presenting a mutual societal response
before the contemporary global order.

Present paper has focused upon an extended attribute of federalism known as cooperative
federalism which is named after the multi-tier system of governance that federalism has to offer
while dynamics of such attribute in the jurisprudential context. Several schemes of studies and
field based analysis have been provided to seek the observational demand that provides the
future of the cooperative federalism. Cooperative federalism in a way provides a political-
administrative authority to the subnational governments in functioning through local level
legislations that must not conflict with the federal rulemaking while it also proposes a higher
degree of dependence to the federal government for policy compliance at subnational level for
policy implementation.1 One of the best example of cooperative federalism was founding of
The Council of Australian Governments (COAG) whose fundamental principle was
cooperative governance which was also the reason shepherded for the need to create an unified
market in Australia as different state rules have created barriers in form of multiple compliance
channels for businesses.2 It is very well settled notion in the context of the cooperative
federalism that subnational governments do inherit a functional utility and not act as mere part
of the hierarchical structure under the federal governments within the overall
intergovernmental system.3

Federalism in its very foundation provides autonomy to the subnational bodies in a country
which when left on their won for a particular purpose could bring into late implementation of
the responsibility and may be variable in compliance like one in the case of education in USA

1
Deeg, R. (1996). Economic globalization and the shifting boundaries of german federalism.Publius, 26(1), 27-
52(30). doi:10.1093/oxfordjournals.pubjof.a029839

2
Infra n. at p. 111 <Painter, M. (1996). The council of australian governments and intergovernmental relations:
A case of cooperative federalism. Publius, 26(2), 101-120. doi:10.1093/oxfordjournals.pubjof.a029844>

3
Agranoff, R. (2001). Managing within the matrix: Do collaborative intergovernmental relations
exist? Publius, 31(2), 31-56(38). doi:10.1093/oxfordjournals.pubjof.a004895
which took long time for state to implement in 20th Century and hence an address by President
Willy Jefferson Clinton had remarked the importance of the federally backed policies that could
be pinched to the states in several important decisions4, also approaches can be made to
implement a successfully functional idea in one state to all other states assisting them with
financial resources and opportunity to bring such change in their respective states.

2- Internationalized practise of cooperative federalism

Cooperative federalism is one of the key feature in recent setup for a federalist democratic
country wherein one the example could be taken with regard to the country of Spain who
although had 17 communities enjoying a political autonomy switched to the cooperative form
of federal government where joint participation supersede the bilateral decision making in the
country.5

3- Hindrance to Cooperative federalism

Increased mobility of capital investment and lack of utility of conventional model of economic
policy as being unresponsive to the globalised competitive market have indicated the challenge
to cooperative federalism from the globalization as the countries have found a higher
differentiation in the internal policy making concomitant to decentralization consequently
formulating a integrative mechanism to accommodate such differentiation6 hence losing the
autonomy towards overall macroeconomic policy making in the nation.

Porf Dicey by the “immutable constitution”7 have developed the base for the American form
of constitution which was further analysed by Corwin, which could be found one of the initial
proponent document, in form of dual nature of federalism wherein the institutionalization of
the federalism was based upon few attributes like the limited power of the governments,
restricted “sovereignty”, non-interference policy, conditional modifications etc.8 Therefore the

4
Clinton, W. J. (1999). Address by william jefferson clinton. Publius, 29(4), 23-32(26).
doi:10.1093/oxfordjournals.pubjof.a030049

5
Börzel, T. A. (2000). From competitive regionalism to cooperative federalism: The europeanization of
the spanish state of the autonomies. Publius, 30(2), 17-42.
doi:10.1093/oxfordjournals.pubjof.a030083.

6
Supra n. at p. 30. < Deeg, R. (1996). Economic globalization and the shifting boundaries of german
federalism.Publius, 26(1), 27-52(30). doi:10.1093/oxfordjournals.pubjof.a029839>

7
Dicey, A. V. (1924). Introduction to the study of the law of the constitution142 (7th ed. 1903).

8
Corwin, E. (1950). The Passing of Dual Federalism. Virginia Law Review, 36(1), 1-24. doi:10.2307/1069035
form of dual federalism has major oppositions to the nature and scope of cooperative federalism
that constitutional regime must serve and Alexander Hamilton in the late 70’s have emphasized
the elements of the dual federalism which was published in a famous manuscript named The
Federalist9 and was worded as follows:

“But as the plan of the convention aims only at a partial union or consolidation, the state governments
would clearly retain all the rights of sovereignty which they before had, and which were not, by that
act, exclusively delegated to the United States. This exclusive delegation, or rather this alienation of
state sovereignty, would only exist in three cases: where the constitution in express terms granted an
exclusive authority to the union; where it granted, in one instance, an authority to the union, and in
another, prohibited the states from exercising the like authority; and where it granted an authority to
the union, to which a similar authority in the states would be absolutely and totally contradictory and
repugnant”

This shows the elemental structure of the dual federalism that incline towards the restrictive
tendencies of the governance pattern where juxtapositioning with the federal and states’ order
of business was frequently observed as the seminal feature, which in response have measured
disruptions in decision making effecting the policy front of the government on both turf.

Approaches and Interpretation to cooperative federalism perspective

There have been arguments proposing the appropriate form of federalism characterization
could be the competitive federalism than the present form of cooperative federalism.10 Reason
to which could be seen as the stagnating of the initiatives and experimentations which in
presence of cooperative federalism diminishes or mislay their sight with the level of conformity
of the decisions at the intergovernmental level as the policy of interdependence and Inter-
coordination of the institutions. This could be seen as major federal policies or laws being made
are palpably followed by the states or subnational authorities for the reason of its presumed
sanctity towards legitimacy. Competitive federalism doesn’t have a cooperative character and
could function independent of allocative resource equalization if the dynamics of tax system

9
The Federalist Papers (Indianpolis: Liberty Fund, 2001), p.155 Retrieved from
http://files.libertyfund.org/files/788/0084_LFeBk.pdf.
10
Painter, M. (1996). The council of australian governments and intergovernmental relations: A case of
cooperative federalism. Publius, 26(2), 101-120(107). doi:10.1093/oxfordjournals.pubjof.a029844
tend to change among the states.11 However in Spanish example, the autonomous communities
have opted for the cooperative federalism as the scope and effectiveness of such form of
federalism have increased in European Union decision making and hence the competitive
regionalism was replaced with the cooperative federalism in country practise and with the
advent of Europeanization in administering the territories, the balance of federal and
subnational governments have impacted with need for a drastic shift that answers the trend for
cooperative federalism.12

The twentieth century US governance has seen dual federalism application wherein the cost
imposed over the subnational governments upon the mandates by the federal government
which in return evidenced traces of cooperative federalism, though which was not the intent
but seen as addendum of previous mandate proposing action, to which even the subnational
governments had dwindling response to make. However, post 1995 there were hostilities seen
among the congressional stakeholders towards proposing mandates to the subnational
government, but the situation before have spoken of itself wherein one of the example was
taken for the Safe Drinking Water Act Amendments of 1986 have imposed heavy cost upon
the local/subnational governments wherein the cost of public water supply was drastically
increased which forced wither the abandonment of the drinking water supply system or leading
to bankruptcy due to cost of mandating the directive. This problem faced by the local
government have responded by another amendment namely Safe Drinking Water Act
Amendments of 1996 wherein the government have relieved the local government from several
expenses and mandates.13 There are restrictions that have been similar to that of the mandates
as seen in the case of the Water Supply, which comes in form of orders like restraining the
state or local governments from indulging in form of business that could further lead to issues
relative authoritative attributes to federalism, for example, restraining the states from cosseting
in economic regulation of transportation businesses, disposing sewage sludge in oceans which

11
Arnold, V. (2005). Competitive Versus Cooperative Federalism: Is a Fiscal Equalization Scheme Necessary
from an Allocative Point of View? Journal of Economics and Statistics, 225(3), 259-282(277). doi:10.1515/jbnst-
2005-0303

12
Supra n at 20. < Börzel, T. A. (2000). From competitive regionalism to cooperative federalism: The
europeanization of the spanish state of the autonomies. Publius, 30(2), 17-42.
doi:10.1093/oxfordjournals.pubjof.a030083>

13
Zimmerman, J. (2001). National-State Relations: Cooperative Federalism in the Twentieth
Century. Publius, 31(2), 15-30(25). Retrieved from http://www.jstor.org/stable/3330955
particularly have impacted the coastal cities, and other such restrains.14 Federalism requires the
unitarization and cooperation among the federal and subnational authorities and also among
the subnational authorities themselves, and therefore especially with the regard to the condition
in Germany depicts multivariate phenomenal shift reaching to marking of arguments that
downscaled the scheme of cooperative federalism in the nation. Intra-national conflicts in
cooperation was serious after the 1970s, before such period, the unitarization led to either legal
uniformity and surplus revenue generation have provided support towards the redistributive
policies while after 1970s’ the subnational authorities or Landers have shown serious
disparities and there was need of a massive redistribution in terms of uitarizing policies.15

4- Determinants of cooperative federalism

There have been several key factors which when infused with the federalism process have
shown a greater tendency towards establishing a cooperative federalism in the context of
particular function, though these attributes may not be exhaustive and could include other
factors as well. Factors such as urgency of the problem, technical assistance, communication
attributes such as openness and frequency, roles and responsibilities of the functionaries at the
levels of governance etc. are some of the key element that plays vital influence upon catalysing
the cooperative federalism attribute.16 In the event of the urgency, the subnational government
tends to shown flexibility in dealing with the issues that have intricate effect on the governance
at the subnational level and hence the self-compliant nature of subnational government favours
the federal functionaries. Technical assistance is one of the major determinant, especially in
the present time when technological distillation has rooted deep in any of the government
programmes, as critical technological infrastructural could act as hindrance in completion of
desired objectified outcome, therefore the level of dependence indicates the cooperative
attribute in the systematic boundaries of the said governmental conclave. Communication
factors is indeed one of the key stimulator, particularly in the micro management of the
governance as there may be contingent challenges and issues that needed to be discussed and
resolved for effective coordination and implementation which is only possible if a balanced
and healthy channel of communication exist between the federal and subnational level

14
Id at p. 26.
15
Benz, A. (1999). From Unitary to Asymmetric Federalism in Germany: Taking Stock after 50
Years. Publius, 29(4), 55-78. Retrieved from http://www.jstor.org/stable/3330908

16
Wright, D. S. (1988). Understanding intergovernmental relations. Belmont, Calif: Wadsworth 397.
stakeholders. Roles and responsibility coexist to cabin a harmonious relation between federal
and subnational governance as there could exist the level of hierarchy which subsists a wider
fluctuation in the power sharing as the authoritative regime at the subnational governance level
could offset the federal authorities and vice-versa according to the given circumstance which
henceforth indices the provenance of authoritative construct and responsibilities towards the
existence of cooperative federalism.

5- Sectoral Perspective in Cooperative federalism

One of the utility which cooperative federalism afford to provide could be seen in the case of
the energy sector wherein the companies for power grid setup require specific regional
consideration like terrain, climate, people, industry and its sensitivity wherein the national and
state level coordination is requisite for futuristic supply of the cost efficient commodity which
would be energy.17 Similar instances in the cases of the retail wheeling or customers preference
for electricity suppliers is one the issue that pertains to the intrastate and interstate
administrative setup wherein the utility entity and public authority which is the subject matter
differing from state to state have clearly hypothesises the aspects of cooperative federalism in
the country of USA18 along the parallel lines of the revenue sharing for both involved states in
such power transferring agreement.19 Another active role of cooperative federalism is seen in
the field of the higher education where the funding arrangements from the federal government
aid and state or local governments funding supports works together deriving their power form
constitution itself in the case of USA20 while education sector is also an example of the
cooperative federalism in India with the constitutionally structured framework deriving power
from List III (Three) of Schedule VI to Constitution of India and interestingly it is noted that
before being placed in List III (Three) it was originally founded in the List II (Two) of Schedule
VI to Constitution of India.21 Entry 25 of List III of Schedule VI of Indian constitution was
inserted in 1976 through an amendment which was generated out of poor performance of state

17
Burns, R. E., Potter, S., & Witkind-Davis, V. (2004). After the lights went out. The Electricity Journal, 17(1), 11-
15. doi:10.1016/j.tej.2003.11.005

18
Vasapoli, J. V. (1996). Interstate transmission for a direct sale: A regulatory gap in wheeling authority? The
Electricity Journal, 9(1), 54-59(55). doi:10.1016/S1040-6190(96)80377-0

19
Id. at p. 59.

20
Oberg, J. H. (1997). Testing federal student-aid fungibility in two competing versions of
federalism. Publius, 27(1), 115-134(118). doi:10.1093/oxfordjournals.pubjof.a029888

21
Schedule 7, Constitution of India.
in focusing towards the education as priority sector, therefore making the case for cooperative
federalism to come in action and subsequently federal intervention in the education wherever
and whenever requisite.

Conclusion

Form the above experiences and analysis it is apparent that there must be perceived prodigies
that conclude the existence of collaborative management in the event of a subnational
government indulged with the federal help that seek to achieve a certain objective22 which is
perceived as the cooperative form of federalism with an implemented structure.

How far the study over the cooperative federalism have concluded its research approach has
been juxtaposed by the behavioural approach towards the governance systems that seek to
achieve success in years. With a large influx of literature coming from the western civilizations
and developed nations, therefore the question in-fact remains open whether such study from
the perspective of developing countries, India specifically being the largest democracy in the
world, have been given different responses as the inhibitor/stakeholders have undergone a
different process and varied heterogeneity at the domestic level.

22