New Federalism holds that the federal government has grown far beyond its constitutionally intended scope, and that meaningful authority over domestic policy should be returned to the states. Proponents argue that decentralization produces better governance, preserves individual liberty, and respects the diversity of preferences across a continental nation. The viewpoint is most closely associated with the Republican Party since the Nixon era, academic constitutional originalists, and libertarian-leaning policy thinkers, though it draws on a tradition of thought that predates the modern conservative movement.

Constitutional fidelity. New Federalists argue that the Tenth Amendment means what it says: powers not delegated to the federal government are reserved to the states or to the people. They contend that decades of expansive Commerce Clause interpretation - particularly after Wickard v. Filburn (1942) - have rendered this reservation effectively meaningless, and that restoring it is a matter of constitutional integrity, not mere policy preference.

Competitive governance and policy experimentation. Drawing on Justice Louis Brandeis's concept of states as “laboratories of democracy,” proponents argue that decentralization allows policy experimentation. A state that tries a novel welfare structure, education model, or regulatory approach produces information that a uniform federal mandate cannot. States that fail can be corrected; a failed federal program is imposed on everyone.

Preference diversity. The United States encompasses widely different populations with different values, economic conditions, and cultural traditions. New Federalists argue that a single national policy on matters like education, land use, or social services will necessarily satisfy no one well. Allowing states to set their own courses respects genuine pluralism rather than papering over it with federal uniformity.

Accountability and proximity. Proponents hold that state and local governments are more accountable to their constituents than the federal bureaucracy. Citizens can more easily monitor, influence, and if necessary exit a state government than a federal one. This proximity makes responsiveness more likely and corruption more visible.

Limiting rent-seeking and regulatory capture. Concentrating policy authority in Washington creates a single high-value target for interest groups. New Federalists argue that dispersing authority across fifty states raises the cost of capture and reduces the payoff, producing cleaner governance overall.

Fiscal discipline. States generally face balanced-budget requirements that the federal government does not. Returning program authority to states, in this view, subjects spending to harder constraints and forces clearer trade-offs than federal appropriations allow.

The intellectual roots of New Federalism lie in the Anti-Federalist tradition and in the compact theory of the union advanced by figures like Thomas Jefferson and James Madison. The more immediate lineage, however, begins as a reaction to the expansion of federal domestic authority during the New Deal and the Great Society.

Richard Nixon coined the phrase “New Federalism” in a 1969 address, proposing revenue sharing - block grants returning federal tax dollars to states with minimal strings attached - as an alternative to categorical grant programs that directed state behavior from Washington. His administration's General Revenue Sharing program (1972) embodied this approach.

Ronald Reagan gave the concept its most prominent articulation. His 1981 inaugural address declared that “government is not the solution to our problem; government is the problem,” and his administration pursued a systematic effort to consolidate categorical grants into block grants and devolve program authority. The 1981 Omnibus Budget Reconciliation Act converted dozens of categorical grants into nine block grants covering areas including community development, social services, and maternal and child health.

The Republican Congress elected in 1994 extended the project. The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 replaced the federal entitlement of Aid to Families with Dependent Children with Temporary Assistance for Needy Families, a block grant to states - the most significant devolution of a major federal program in the postwar era.

Judicial reinforcement came through what scholars call the Rehnquist Court's “federalism revolution” of the 1990s. Decisions including United States v. Lopez (1995) and United States v. Morrison (2000) revived limits on Commerce Clause authority that had been dormant since the New Deal, while Printz v. United States (1997) held that the federal government could not commandeer state officials to administer federal regulatory programs.

Ronald Reagan - As president, Reagan made New Federalism a centerpiece of domestic policy, pursuing block grants and administrative devolution throughout his two terms. His rhetoric gave the viewpoint its most widely recognized modern form.

Richard Nixon - Nixon coined the term and launched the first revenue-sharing programs, framing decentralization as a pragmatic managerial reform rather than ideological rollback.

William Rehnquist - As an Associate and then Chief Justice, Rehnquist authored or joined the key decisions of the 1990s federalism revival, grounding limits on federal power in both the Commerce Clause and the Tenth and Eleventh Amendments.

Antonin Scalia - A committed originalist, Scalia argued consistently that the structural provisions of the Constitution - including the enumeration of federal powers - were as binding as the Bill of Rights and required genuine judicial enforcement.

Clarence Thomas - Thomas has pushed further than most colleagues, arguing in concurrences that Wickard and related Commerce Clause precedents should be revisited at their roots rather than merely trimmed at the margins.

Milton Friedman - The economist argued for decentralization on efficiency and choice grounds, and his proposals for school vouchers exemplified the New Federalist preference for returning decisions to the lowest viable level.

Michael Greve - A scholar at the American Enterprise Institute and author of The Upside-Down Constitution (2012), Greve argues that the original constitutional structure was designed to prevent interstate cartels and that restoring competitive federalism is both legally sound and economically beneficial.

Randy Barnett - A Georgetown law professor and libertarian constitutional theorist, Barnett has argued in Restoring the Lost Constitution (2004) that the original meaning of the Constitution sharply limits federal power and that courts have an obligation to enforce those limits.

Block grants vs. full devolution. Some New Federalists favor block grants - transferring federal revenue to states with broad discretion - as a realistic reform within the current system. Others regard this as insufficient, arguing that as long as Washington raises and redistributes the money, it will inevitably attach conditions and states will remain dependent. True federalists, on this view, should pursue tax cuts rather than grant restructuring, letting states raise their own revenue and set their own priorities.

Federalism as principle vs. federalism as strategy. Critics within the coalition note that Republican administrations have sometimes invoked federal preemption to override state laws - in areas like financial regulation, gun rights preemption of local ordinances, or marijuana policy - when doing so served conservative policy ends. Principled New Federalists argue that genuine commitment to the doctrine requires accepting state authority even when states reach outcomes one dislikes; strategic federalists are more willing to use federal power when the policy outcome favors their position.

The role of federal civil rights law. A significant internal tension involves whether New Federalism must accommodate the federal civil rights framework established in the 1960s. Most mainstream proponents accept the Civil Rights Act of 1964 and the Voting Rights Act as legitimate exercises of federal authority given the demonstrated failure of states to protect individual rights. Libertarian purists argue that even these laws raise constitutional questions. The debate reflects a deeper disagreement about whether federalism is an unconditional structural commitment or one that yields when individual rights are at stake.

Judicial enforcement vs. political process. Some proponents believe that restoring federalism requires active judicial enforcement of constitutional limits - that courts abdicated their role after 1937 and must reclaim it. Others, following Federalist Society co-founder Steven Calabresi on some points and echoing political process theorists, argue that the political branches and democratic accountability are the more appropriate mechanisms, and that judicial activism in either direction is constitutionally suspect.

Interstate competition and the race to the bottom. New Federalists generally embrace competitive federalism as beneficial, arguing competition drives states toward efficient policy. Critics within the tradition acknowledge that some competition may produce regulatory undercutting on matters like environmental standards or worker protections, and debate where, if anywhere, a federal floor is appropriate.

• Federalism - Main topic page
• Cooperative Federalism Viewpoint
• Dual Federalism Viewpoint
• Nullification Viewpoint
• History of Federalism
• Federalism Debate
• Constitutional Federalism Consensus
• Commerce Clause
• Tenth Amendment
• Block Grants

1. Reagan, Ronald. “Inaugural Address.” January 20, 1981. Ronald Reagan Presidential Library. https://www.reaganlibrary.gov/archives/speech/first-inaugural-address
2. Nixon, Richard. “Address to the Nation on Domestic Programs.” August 8, 1969. The American Presidency Project. https://www.presidency.ucsb.edu/documents/address-the-nation-domestic-programs
3. United States v. Lopez, 514 U.S. 549 (1995).
4. United States v. Morrison, 529 U.S. 598 (2000).
5. Printz v. United States, 521 U.S. 898 (1997).
6. Wickard v. Filburn, 317 U.S. 111 (1942).
7. Barnett, Randy E. Restoring the Lost Constitution: The Presumption of Liberty. Princeton University Press, 2004.
8. Greve, Michael S. The Upside-Down Constitution. Harvard University Press, 2012.
9. Conlan, Timothy. From New Federalism to Devolution: Twenty-Five Years of Intergovernmental Reform. Brookings Institution Press, 1998.
10. Personal Responsibility and Work Opportunity Reconciliation Act of 1996, Pub. L. 104-193, 110 Stat. 2105 (1996).
11. Omnibus Budget Reconciliation Act of 1981, Pub. L. 97-35, 95 Stat. 357 (1981).
12. New State Ice Co. v. Liebmann, 285 U.S. 262, 311 (1932) (Brandeis, J., dissenting) (articulating the “laboratories of democracy” concept).