The importance of federalism

By Scott Sumner.

"This news headline caught my eye:

Trump: It’s my decision when to reopen U.S. economy

Actually, President Trump does not have the power to reopen the economy, and that’s a good thing.  The men who wrote the Constitution understood the danger of giving too much power to any one person.

There are good arguments on both sides as to when and how fast to reopen the economy.  In my view, the answer will vary state by state and industry by industry.  There’s also an enormous amount of uncertainty as to exactly how to determine the optimal policy.  In that environment, there’s a great advantage to having these decisions be made at as local a level as possible.  Thus, while I suspect that Sweden’s current policy is not optimal, that Nordic country is doing a great service to Europe by providing evidence on the consequences of an alternative policy path.

Giving too much power to any one person is dangerous, especially when that person might be influenced by political considerations that go beyond the best interest of the country as a whole:

In phone calls with outside advisers, Trump has even floated trying to reopen much of the country before the end of this month, when the current federal recommendations to avoid social gatherings and work from home expire, the people said. Trump regularly looks at unemployment and stock market numbers, complaining that they are hurting his presidency and reelection prospects, the people said.

That’s not to say Trump’s views are necessary wrong; rather that the procedure he uses to reach decisions is not reliable.  Thus I’d still favor local control even if in one particular case you could convince me that the views of the person who happened to be president at the time were superior to the views of the average mayor or governor.  In the long run, competition between states will produce better governance than central planning."