Federalism is the system of government in which sovereignty is constitutionally divided between a central governing authority and constituent political units. It is based upon democratic rules and institutions in which the power to govern is shared between national and state governments, creating a federation. Dual federalism is a political arrangement in which power is divided between national and state governments in clearly defined terms, with state governments exercising those powers accorded to them without interference from the national government. Dual federalism is defined in contrast to cooperative federalism, in which national and state governments collaborate on policy. Dual and cooperative federalism are also known as 'layer-cake' and 'marble cake' federalism, respectively, due to the distinct layers of layer cake and the more muddled appearance of marble cake.
Federalism was the most influential political movement arising out of discontent with the Articles of Confederation, which focused on limiting the authority of the federal government. The movement was greatly strengthened by the reaction to Shays' Rebellion of 1786-1787, which was an armed uprising of farmers in western Massachusetts. The rebellion was fueled by a poor economy that was created, in part, by the inability of the federal government to deal effectively with the debt from the American Revolution. Moreover, the federal government had proven incapable of raising an army to quell the rebellion, so Massachusetts was forced to raise its own.
The most forceful defense of the new Constitution was The Federalist Papers , a compilation of 85 anonymous essays published in New York City to convince the people of the state to vote for ratification. These articles, written by Alexander Hamilton and James Madison, examined the benefits of the new Constitution and analyzed the political theory and function behind the various articles of the Constitution. Those opposed to the new Constitution became known as the Anti-Federalists. They generally were local rather than cosmopolitan in perspective, oriented to plantations and farms rather than commerce or finance and wanted strong state governments and a weak national government. The Anti-Federalists believed that the Legislative branch had too much power and that they were unchecked, the Executive branch had too much power, and that there was no check on him and that a Bill of Rights should be coupled with the Constitution to prevent a dictator from exploiting citizens. The federalists argued that it was impossible to list all the rights and those that were not listed could be easily overlooked because they were not in the official bill of rights.
After the Civil War, the federal government increased influence on everyday life and size relative to state governments. Reasons included the need to regulate businesses and industries that span state borders, attempts to secure civil rights, and the provision of social services. The federal government acquired no substantial new powers until the acceptance by the Supreme Court of the Sherman Anti-Trust Act. From 1938 until 1995, the Supreme Court did not invalidate any federal statute as exceeding Congress' power under the Commerce Clause.
The Great Depression marked an abrupt end to Dual Federalism and a dramatic shift to a strong national government. President Franklin D. Roosevelt's New Deal policies reached into the lives of U.S. citizens like no other federal measure had. As the Supreme Court had rejected nearly all of Roosevelt's economic proposals, in 1936 the president proposed appointing a new Supreme Court justice for each sitting one aged 70 or older. The expansion of the court along with a Democrat-controlled Congress would tilt court rulings in favor of Roosevelt's policies. The national government was forced to cooperate with all levels of government to implement the New Deal policies; local government earned an equal standing with the other layers, as the federal government relied on political machines at a city level to bypass state legislatures. In the final analysis, federalism in the United States has been structured to protect minority rights while giving enough power to the states to control their own affairs. This conflict and duality remains a contested territory, especially after the Reagan devolution and his insistence on "marble-cake" federalism.