WASHINGTON — The essence of progressivism’s agenda is to create a government-centered society by increasing government’s control of society’s resources, then distributing those resources in ways that increase the dependency of individuals and social groups on government. Hence this stipulation in Congress’ just-enacted $1.9 trillion money shower: None of the $350 billion allocated for state governments can be used to finance tax cuts.
So, the federal government is using the allocation of society’s financial resources to state governments to coerce them into maintaining their existing claims on such resources. This illustrates how progressives try to implement a leftward-clicking ratchet. The Supreme Court, whose duties in supervising democracy include reminding a forgetful Congress about federalism, should find the following provision unconstitutional.
It says states shall not use federal funds “to either directly or indirectly offset a reduction in net tax revenue . . . resulting from a change in law, regulation, or administrative interpretation.” This seems to forbid tax relief of any kind, for any reason. If so, it constitutes (in the language of a letter by 21 Republican state attorneys general seeking clarity from the Biden administration) “an unprecedented and unconstitutional intrusion on the separate sovereignty of the States through federal usurpation of essentially one half of the State’s fiscal ledgers i.e., the revenue half.”
The letter notes that money is fungible, and states must balance their budgets, and adds this: Washington’s “gross federal overreach,” which takes “state tax policy hostage,” is “the greatest attempted invasion of state sovereignty by Congress in the history of our Republic.” Today’s 117th Congress cannot bind the 118th, but, the letter says, a governor accepting stimulus funds under Washington’s terms could bind his state’s legislature and his successor from cutting any tax or tax assessment through 2024.
The Biden administration’s laconic response is: “It is well established that Congress may establish reasonable conditions on how states should use federal funding that the states are provided.” The Supreme Court, however, has thought about reasonableness.
In 1984, Congress, concerned about interstate problems arising from a diversity of states’ drinking ages, imposed a national minimum age of 21, to be enforced by withholding a percentage of federal highway funds from noncompliant states. South Dakota, which permitted 19-year-olds to purchase low-alcohol beer, objected. The court, however, held that 5% was a “relatively small financial inducement” and “not so coercive as to pass the point at which pressure turns into compulsion.”
So, the court signaled that some financial inducement could constitute unconstitutional compulsion. Arizona’s $4.8 billion share of the $350 billion at issue today equals about 40% of this year’s state budget from general funds — not a “relatively small” sum, a coercive one.
In 1985, Congress gave states various financial incentives to dispose of low-level radioactive waste within their borders. New York challenged this, and the Supreme Court objected to one of the incentives: A state failing to dispose of waste by a set date must take title to and possession of the waste and become liable for all damages the producer of the waste might suffer because of the state’s failure to promptly take possession.
The court held that this “would ‘commandeer’ state governments into the service of federal regulatory purposes” and thus be “inconsistent with the Constitution’s division of authority between federal and state governments,” thereby violating the 10th Amendment (“The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people.”)
The court said “the Constitution has never been understood to confer upon Congress the ability to require the states to govern according to Congress’ instructions.” Today, however, Congress is attempting to commandeer the states, telling them they cannot receive their portions of the $350 billion — which Congress says addresses an emergency — without forfeiting discretion concerning their core function, fiscal policy.
In the 2010 Affordable Care Act (“Obamacare”), Congress stipulated that states refusing to participate in the expansion of Medicaid would lose their existing Medicaid funding. The court blocked this: “The threatened loss of over 10% of a state’s overall budget is economic dragooning that leaves the States with no real option but to acquiesce.”
Dragooning, commandeering, coercing, compelling — pick your gerund, the legal significance of the practices denoted is the same: The progressive drive to break the states to the saddle of the federal government, which progressives attempt for the purpose of producing an ever-more government-centered society, is unconstitutional.