The New Rules of Federalism

Published August 23, 1999

After a great deal of debate and deliberation, your Congress passes a law that says all employers must pay workers for overtime. That is the law of the land, and everyone must follow it, right?

Wrong. The sovereign State of Maine doesn’t have to. And neither do any of the other states. That’s the effect of a recent opinion by the United States Supreme Court. The ruling came in Alden v. Maine, one of three cases the court handed down at the end of June.

The court didn’t say that Congress can’t pass laws like the Federal Labor Standards Act, the one at issue in the Alden case. In fact, that’s been on the books since the 1930s. And the court didn’t say that states don’t have to follow the law. It’s just that if they don’t, you can’t sue them. Unions that believe the states are not complying with the Act can lobby the state to comply with the federal law, complain to the media, mount a grassroots campaign, and do many other things to resolve their grievances, but they cannot use the courts to force Maine to comply with the law.

How can this be? What force of logic or law prevents the courts from enforcing legislation that Congress justly passes? The Court points to the ancient doctrine of sovereign immunity: The king can do no wrong. Therefore you can’t sue him unless he allows you. In constitutional parlance, you can’t sue the state unless it consents.

The doctrine is codified in the 11th Amendment to the U.S. Constitution, which states: “The judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.”

The amendment does not speak to the question of whether a state can be sued by one of its own citizens in a state court for a violation of a federal law, but the court ruled that to be a principle so firmly established at the time the Constitution was written that it didn’t need to be explicitly stated in an Amendment.

The Supreme Court ruled that sovereign immunity from suit is a vital part of the checks and balances created by the Constitution to limit the authority of any one branch of government. Each State, the court said, is a sovereign in its own right with all of the rights accorded to governments, unless specifically surrendered. Since Maine did not explicitly and deliberately surrender the right not to be sued for violations of federal law, then Alden couldn’t sue.

Alden puts the Court back on the path of respecting States’ rights, which were plainly recognized by the Founding Fathers but largely abandoned after the Civil War and then lost sight of entirely during the enormous concentration of federal power that occurred during the Great Depression.

Libertarians might be justified in cheering the Alden decision, since many of the greatest expansions of government power, and consequently the most egregious violations of individual rights, have come from the federal government. But Alden’s sister cases, both involving contests by the private College Savings Bank against the state-run Florida Prepaid Post Secondary Education Expense Board, are more troubling for free market proponents. In those cases, the court ruled that a government agency could not be sued for violating a private competitor’s trademark or for misrepresenting its product, in this case a tuition prepayment program.

In keeping with its new respect for state sovereignty, the court said the lawsuits were not proper because Florida had not consented to be sued under the federal Trademark Act. Congress’s power to legislate under the Fourteenth Amendment’s due process clause did not trump Florida’s immunity, the court stated, because Congress did not make the case during legislative debate that the Trademark Act was necessary to correct a due process problem. Consequently, trademark protection does not rise to the level of importance of a right or activity – such as voting — that may require federal activism at the expense of state sovereignty.

Once again, just because a particular right or activity is not protected in federal and state courts does not mean it cannot be protected in other ways. Non-judicial remedies involving institutions other than the courts may be just as or even more effective than the courts. And the court’s decisions create a doorway for individuals and organizations who feel their complaints deserve court action: They can lobby their states to explicitly surrender their right to be immune from legal action. For example, if inventors and businessmen in Illinois believe the court’s decisions threaten the security of their patents and trademarks, they can call on the Illinois General Assembly to adopt legislation specifically allowing suits against the state in such cases.

The paradox for libertarians posed by the court’s recent decisions is that the same decisions that limit the power of the federal government may also increase the power of states. Had the court chosen to base its decisions on the rights of individuals, instead of an ancient and quirky notion of the sovereignty of kings, it would have succeeded in limiting the power of both levels of government. But that strategy, too, would hold some risk, since it would expand the power of the judiciary. The Court’s decisions demonstrate that there is no easy way, no short-cuts, to protecting individual liberty.

All of this points to questions that go beyond the states’ sovereign immunity. The most basic question is how, in this new era of Supreme Court activism on behalf of states’ rights, do we ensure that the rights of individuals are not read out of the Constitution? How do we mobilize at the state and local level to ensure that such rights as are no longer protected by the federal courts will be protected in the future by other institutions?

Despite all the questions, one thing is clear: The rules of federalism have changed, and many debates that once focused on federal legislation will now return to state and even local governments. Whether this is a boon for freedom or a new threat to the same depends on whether concerned citizens in each state rise to meet the challenge.

Steve Merican is an attorney in private practice in Chicago and a policy advisor to The Heartland Institute. Nothing in this essay should be viewed as intended to influence the passage of pending legislation, or as reflecting the views of The Heartland Institute. Copyright 1999 The Heartland Institute. For more information, visit our Web site at or call us at 312/377-4000.