Federalism, mandates, and devolution

Unfunded mandates are a form of state regulation imposed by the national government in which the states receive no funding from the federal government to comply with the mandate. Unfunded mandates impose national standards on states but make the states pay for any expenses that come with the mandate. An example of an unfunded mandate is the No Child Left Behind Act. States and local governments (and rightfully so) saw unfunded mandates as an extremely unfair method of control by the federal government since they were forced to give up power to the federal government and had to provide the funding to carry out these mandates.

The Unfunded Mandates Reform Act of 1995 stated that any mandate with an uncompensated state and local cost of more than fifty million dollars a year, as determined by the Congressional Budget Office (CBO), can be stopped by a point of order raised on the House or Senate floor. Devolution, on the other hand, is the strategy of delegating to the states more and more authority over a range of policies that had been under national government authority, plus providing the states with a large portion of the costs for these former national programs.

In actual practice, devolution would be much more effective at reducing unfunded mandates. During the first year of its operation, UMRA stopped only eleven mandates, so there were still fifty-eight mandates with costs of less than fifty million dollars a year imposed on the states. The most important impact of UMRA was that it acted as a deterrent to mandates in the drafting and early consideration of legislation. So it made Congress think twice about a mandate before passing it but did not prevent mandates from being passed. Devolution though puts the policy-making power in the hands of state and local governments and gives them significant amounts of funding for their new policies. This strategy has many positives. It allows states and local governments to decide what is best for them instead of Congress. Second, since every state is different, there is no longer only one blanket policy for all states but instead many different ways for states to accomplish the same end. For example, when welfare was changed from a combined federal-state program into a block grant to states, states were able to find the welfare policy that best met the needs of their citizens instead of a standard policy for all states, as had been done under the federal-state welfare program. Last and related to the second point, devolution allowed states to act as "laboratories of democracy" by experimenting with different approaches for a policy to find the one that best served the needs of their citizens. This point is evinced by the diverse approaches to welfare programs by the states.