The Journal of the New Rules Project
Fall 2001

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editor's note
Higher levels of government should have to provide a compelling reason for overriding the will of government closer to the people. Increasingly, citizen protections are lost to preemption.

place rules
Missouri's meatpackng law stands. Maine Rx Program survives suit. Wisconsin man draws attention to unfair gas pricing. California allows municipal control of electricity. Oregon preempts living wage laws.

Features

Rogue Agencies Gut State Banking Laws
The only reason you're not afraid of the Office of the Comptroller of Currency and the Office of Thrift Supervision is because you don't know what they do. Called indentured servants to the national banking industry, they are dismantling the state regulatory system piece by piece, with nothing more than a polite scolding from Congress. By Stacy Mitchell

On the Cutting Edge
A law requiring in-state processing helps keep Idaho's timber industry thriving while harvests decline and sawmills close across the Pacific Northwest. By Sarah Hannigan

Feds Swat State Support for Medical Marijuana
For more than 20 years states have been passing legislation designed to allow their citizens to use marijuana as medicine, and for more than 20 years, federal agencies, Congress and the Supreme Court have stymied these efforts. By Daniel Kraker

Mapping the Internet
Geo-locators can determine an internet user's geographic location. Online retailers and governments are interested in perfecting this technology, but it might also prove useful to local economies. By Sarah Hannigan

[editor's note]

Who Should Make the Rules?

In June, a front page story in The Washington Post informed the nation that the White House planned, by executive fiat, to allow federally funded religious organizations to ignore local anti-discrimination laws. A general outcry arose. The President backed down. It was one of the few victories defenders of local control have won in recent years. At this writing, Congress is deciding whether to do through legislation what the executive branch decided not to do through regulation.

Increasingly higher levels of governments are overruling those closer to the citizenry. State legislatures override city councils and county commissions. Federal agencies and Congress override state legislatures. International agencies like the World Trade Organization override congresses and parliaments.

In 1999, the Minnesota legislature stripped Minneapolis and Saint Paul of their authority to require public employees to live inside the city. Earlier this year, after Portland had enacted a living wage ordinance for city contractors, the Oregon legislature prohibited such an ordinance from being extended to all city businesses. A few months later the Pennsylvania legislature dismantled Philadelphia's anti-predatory lending ordinance.

At the national level, as Daniel Kraker discusses in this issue, Presidents Reagan, Bush, Clinton and now Bush junior steadfastly have refused to recognize the right of states to legalize marijuana for medical purposes. George W. Bush's national energy plan would grant federal agencies the right to impose high-voltage electricity transmission lines on reluctant states. The World Trade Organization ruled that European nations have no right to ban the use of hormones in beef cattle, even when the ban applies to domestic as well as imported cattle.

Both liberals and conservatives pay lip service to the idea that government works best when it is closest to the people. But their actions belie their words. Both firmly believe that local authority should be abolished if it hinders national efficiency, even if the economic costs are theoretical and trivial. Liberals affirm the need for collective authority, but want it exercised primarily at the national level because communities are parochial and too often influenced by the passions of the moment. Conservatives abhor authority exercised collectively at any level, echoing the judgment of Edmund Jennings Randolph, who told the Constitutional Convention, "Our chief danger arises from the democratic parts of our constitutions."

The federal courts are the ultimate arbiters of where power rests. Mostly, they favor centralized power, even when the justification for centralization is weak. In the mid 1980s, for example, Michigan required its counties to become responsible for disposing of their own garbage within their own jurisdictions. In return, counties were allowed to prevent the importation of garbage from less responsible communities. The Supreme Court overturned Michigan's law even though Congress had not explicitly denied Michigan that authority.

In our cover story, Stacy Mitchell describes the sordid history of federal courts overturning state and local banking-related laws even after Congress formally criticized federal agencies for invading state authority.

"Who governs?" is becoming one of the fundamental questions of our time, even in the age of the world wide web. Many viewed the internet as inherently immune from national regulation. But as Sarah Hannigan points out, advances in technology now allow nations to know the geographic location of information receivers. Now nations technically can regulate the flow of information. If the Netherlands allows pornography and Saudi Arabia does not, should Saudi Arabia have the authority to impose its cultural perspective within its borders?

In answering these questions, we should be guided by the principle of subsidiarity: a higher level of government should not override the will of governments closer to the people unless it can make a compelling case for doing so. The burden of proof lies on preemption, not on devolution. The European Union already embraces this principle.

Will local control ensure beneficial outcomes? Of course not. But local control enables the widest possible participation. For example, there has been a considerable amount of local debate about whether residency requirements are useful. Most cities have decided they are not. A few dozen have decided that those who deliver public services paid for by local taxes should live within the community they serve. Why should the state legislature abolish their right to make that decision? Almost 60 percent of Arizonans, by direct popular vote, wanted doctors to be able to prescribe marijuana. Why should a handful of people 2500 miles away deny them the right to make that decision?

"It would be folly to argue that people cannot make political mistakes," Calvin Coolidge observed, "But compared with the mistakes which have been made by every kind of autocracy they're unimportant."

--David Morris

David Morris
Vice President, Institute for Local Self-Reliance
© 2001 Institute for Local Self-Reliance

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