On Retaining the States’ Veto-Power in the European Council: Sovereignty vs. Democracy

Both the filibuster in the U.S. Senate and the veto in the European Council reflect the act that the respective states were sovereign and retain a portion of that governmental sovereignty that has not been delegated to the respective Unions. But whereas the American filibuster is compatible with a federal system based on dual-sovereignty (states and union), the European veto is not; rather, each state having a veto is at home in a confederation, which is characterized by the states retaining their sovereignty rather than having given up some in becoming a state. In April 2026 shortly after Viktor Orbán had lost his bid for re-election in the E.U. state of Hungary, the E.U.’s foreign minister argued publicly that the states’ veto in the European Council (and the Council of Ministers) runs contrary to the democratic principle of majority rule. The prerogative of retained and residual governmental sovereignty was essentially being pitted against a fundamental principle of democracy.

Kaja Kallas, the E.U.’s foreign minister, castigated the requirement of unanimity in the European Council (in competencies, or enumerated powers, in which qualified majority voting does not apply) because the votes of 26 state governments can be hijacked by a single holdout. Her assumption is that majority-rule rather than the rule by one (holdout) is fundamental to democracy, whether direct or representative. Referring to the vetoes that had been exercised by the then-outgoing governor of the E.U. state of Hungary, Viktor Orbán, Kallas pointed out that the Council doing what only one state wants, “not what the 26 [others] want . . . is not really democracy.”[1] In fact, one-state rule can be thought of as autocratic rather than democratic. If so, then it follows that the remainder of sovereignty retained by the states as veto power is antithetical to democracy. Although both principles are valid in a federal system characterized by dual-sovereignty rather than all sovereignty being retained by the states, I contend that a sufficient recognition of the retained sovereignty of the states lies in the voting method by qualified majority, and furthermore, that such a method is not in conflict with democracy because even a super-majority is majority rule.

To be sure, the E.U.’s basic (constitutional, or government framework) law provides “a legal pathway to move from unanimity to qualified majority voting. However, . . . such a shift itself requires unanimous consent.”[2] Such a blatant “Catch 22” suggests that the state governments were exploiting a conflict of interest in devising and approving the pathway as if they were states in a confederation, which, unlike modern federalism, according to Kenneth Wheare’s Federal Government, involves no transfer of limited sovereignty (i.e., enumerated powers) to the federal level. That the hamstringing non-qualified-majority-vote policy and legislation at the federal level could easily have been foreseen indicates a proclivity to put the interests of their own states, and the states altogether, above federal initiatives for the good of the whole, which is more than merely the sum of the parts. In fact, the veto itself may imply that the whole is merely such a sum.

Qualified-majority voting enables sufficient unity at the level of the whole and enables the federal level to exercise its exclusive and shared competencies, or powers. Kallas said, “we need to be united and able to take decisions.”[3] So unity should not be so total that decisions cannot be taken and implemented at the federal level, which consists not only of the European Council (and the Council of Ministers), but also the Commission, Parliament, and supreme court (i.e., the ECJ), which are not so beholden to state-level interests that can differ from the interests of the whole, as represented by the Union.

The counter-argument made by Charles Michel (interestingly at the time of Kallas’s interview) in favor of keeping the veto in the Council that he had chaired from 2019 to 2024 is spurious. Firstly, he undercut his argument against the pressing need to shelve the veto mechanism by predicting that the European Council would be not be more unified on Ukraine following Orbán’s departure because other governors “share elements of his political stance, including on Ukraine.”[4] Slovakia, for instance, could easily step into Orbán’s shoes. This prediction makes Kallas’ point even more urgent!

Michel went on to claim that “the ‘European Dream’ depends on collective agreement among all 27 member states.”[5] Such would be the case were the E.U. a confederation of sovereign states, such as the Articles of Confederation were as the treaty made by the sovereign countries forming the U.S. until 1789, but the E.U.’s federal level enjoys exclusive and a shared-portion of competencies, or enumerated powers, and such sovereignty does not depend on unanimity at the state level because the states are not fully sovereign. The political-type category mistake in which a modern federal system of dual sovereignty is supposed to be a confederation was ultimately responsible for why Britain seceded from the Union; as prime minister, David Cameron mischaracterized the E.U. as but one of the “networks” of which Britain had joined. It is no wonder that a significant number of the Brits chaffed at even the limited governmental sovereignty that the E.U. itself enjoyed at the expense of full state sovereignty.

Michel’s “European dream” involves yet another problematic claim. “If you stop trying to involve every [state],” he said, “you risk weakening the EU’s weight on the international stage.”[6] This statement incorrectly assumes that any state on the losing end of a qualified-majority vote in the Council is not involved in the process, and that the E.U.’s very credibility on the world stage is not undercut when one state hinders federal action in foreign and defense affairs. Even as Russia continued to invade Ukraine for over four years, that the E.U. could not support Ukraine militarily made the Europeans look weak and unprincipled on such an obvious case of unprovoked military invasion.

Moreover, I dispute Michel’s utopian fantasy that 27 governors of states with differing interests, both economic and geopolitical, will nonetheless be unanimous enough on specific federal policy and legislative proposals for the principle of unanimity to be viable (i.e., workable enough) for the E.U. to exercise its own competencies that are subject to unanimity. Put another way, for the states to have delegated a significant amount of governmental sovereignty to the E.U. and yet selfishly, as per state-specific interests, to hold onto unanimity on many important matters being considered in the federal-level councils constitutes wanting to have one’s cake and eat it too. Such a capricious mentality does not deserve credibility on the world’s stage.

To be sure, Michel warned against governors misusing (to excess) the veto-power of their respective states in the Council, noting that the veto should only be used as it was intended to be used, “only when vital [state] interests are at stake.”[7] Given that the authority has been up to the governors themselves whether to use their power, however, an expansionist wielding of the vetoes should have been anticipated at Lisbon. Besides over-valuing even petty interests, as if they should outweigh the interests of the whole (Union), governors could easily invent such interests in solidarity with a foreign foe of the E.U. and thus undercut the Union itself on the world stage. I am referring here to Orbán’s relationship with Russia’s President Putin—Orbán even went to Moscow, undercutting President Von der Leyen’s policy against Putin’s militaristic aggression unprovoked in Ukraine.

The Von der Leyen administration was wise in looking outward to the credibility of the E.U. and its long-term functioning as a federal rather than state-centric system of governance, whereas Michel was entrenched in a status quo premised on fallacious arguments and even a category mistake. Ironically, for the need to expunge the veto-power from the federal-level councils after the departure of Orbán to still be felt as pressing, Michel’s prediction of no increase in cohesion among the governors was significant. Unfortunately, as an impetus to even needed political reform, the abstraction of a prediction pales in comparison to the actual use of vetoes, such as Orbán’s veto of the loan to Ukraine.

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1. Jorge Liboreiro, “Orbán-Style Vetoes Undermind E.U. Democracy, Kaja Kallas Tells Euronews Hoping for Reset,” Euronews.com, 24 April 2026.
2. Ibid.
3. Ibid.
4. Angela Skujins, “European Council Should “Think Carefully” before Removing Unanmity, Says Michel,” Euronews.com, 24 April, 2026.
5. Ibid.; italics added for emphasis.
6. Ibid.
7. Ibid.

On the E.U.’s “Pragmatic” Federalism

It is ironic that even though European political theorists, including Immanuel Kant, Johannes Althusius, and Kenneth Wheare, made substantial contributions on the topic of federalism, even political leaders in the E.U. as late as 2025 were stumbling over the basics, getting the very concept wrong. Unfortunately, that has caused journalists to trip and fall too, leaving E.U. citizens grappling over the apparent problem of being citizens both of their state and the E.U. even though, according to former European Central Bank President Mario Draghi spoke in 2025 in favor of “’pragmatic federalism’ as the political conditions for a true, federal union do not exist in the E.U. at the moment.”[1] The claims that “pragmatic federalism” is somehow not indicative of “true” federalism, and, moreover, that somehow the E.U. has states that are semi-sovereign (as the E.U. itself has exclusive competences) and yet federalism does not apply are patently absurd. Draghi was confusing the politics of the moment, in which the anti-federalist, Euroskeptic ideology was still too powerful for more governmental sovereignty to be moved to the federal level from the states, with whether the E.U. had a federal system already. In other words, “political conditions” are distinct from whether the E.U. has a federal system of public governance. Draghi’s assertion is all the more astounding not only because of his governmental experience at the federal level, but also because the dual-sovereignty (of the states and the Union) means that the E.U. fits within the category of modern federalism rather than confederalism (using Wheare’s terminology). Europeans have quite understandably been confused in trying to classify the E.U. away from the pull of the anti-federalist ideology in Europe.

That ideology has been a major impediment to the E.U. being able to govern. Although qualified-majority voting applies to some of the E.U.’s enumerated powers, or competencies, enough of the important matters of policy and law have been requiring unanimity in the European Council and the Council of Ministers that the veto-power of each of the 27 state governments has “thrown a wrench” in the governmental machinery at the federal level, especially in foreign policy and defense. Whereas the U.S. at first federalized those areas, the E.U.’s initial emphasis was on economic policy and law, so drifting over to include the more traditionally-federalized domains has been stymied by recalcitrant governors threatening to wield their respective vetoes in the Council even in the face of an overwhelming consensus.

For example, between 2011 and 2025, “Hungary vetoed E.U. proposals more than any other member state . . ., with a total of 19.”[2] A “total of 46 vetoes,” moreover, were “exercised in the E.U. by 15 member states across 38 issues.”[3] Poland ranked second with seven vetoes. “Hungary has vetoed a significant number of joint foreign policy statements, but it has also blocked proposals to lend concrete support to Ukraine and start formal E.U. accession talks,” which are necessary for Ukraine to become the 28^th state in the Union.[4] It is hardly surprising, therefore, that the Commission, the E.U.’s executive branch, was by the end of 2025 “deliberately structuring its proposals [for legislation and foreign policies] in order to avoid requiring unanimous consent” from the states in the councils, which, after all, represent the states whereas the European Parliament represents E.U. citizens.[5] With such governmental machinery, plus the E.U.’s supreme court, the European Court of Justice, residing at the Union level, the claim that the E.U. is not a true federal union of states is utterly untenable. “Pragmatic” federalism, which is actually a governmental tool in the E.U.’s basic law, does not nullify the E.U.’s federal system, rendering the E.U. as a “multi-speed bloc.” That label actually signifies decadent jargon rather than any kind of governmental system that is capable of enacting federal laws that are binding on the states and anyone on the E.U.’s territory.

Pragmatic federalism is simply a tactic that the Commission can use to bypass the requirement of unanimity in the Councils, which, like the U.S. Senate, represent the states. The tactic was used, for example, to pass federal legislation to phase-out “Russian fuels under the REPowerEU framework” and to “extend the freeze on the Russian assets.”[6] So too, in passing legislation enabling the E.U. to issue debt to support Ukraine militarily, the European Council “bypassed the need for unanimity among member states” by “gathering those [state governors] who wanted to work together while keeping Hungary, Slovakia and the Czech Republic out of the deal as a condition for it to go forward. In doing so, the E.U. . . . showed a new path forward—one where the unanimity requirement need no longer obstruct” the passage of legislation at the federal level.[7] States could be exempted, such as had been done in the Schengen Agreement and the Stability Pact. The exemption of particular states from a federal program, policy, law, or regulation does not invalidate the federal system; rather, the tool merely renders the federal system more flexible. In fact, the U.S. could benefit by adopting the mechanism, especially because so much power has accrued especially since 1865 at the federal level at the expense of state differences. Exempting certain states from a given proposal would not nullify America’s federal system.

Beyond “pragmatic” federalism in the E.U., the question of rendering the state-veto obsolete was being seriously considered by the end of 2025. With 27 states in the E.U. and Russia invading Ukraine just east of the E.U.’s territory, the E.U. could ill-afford the continuance of the veto, especially in the domains of foreign policy and defense. That unanimity would be required to amend the E.U.’s basic law to rid the union of the state-veto is itself a problem, but it could be solved by any states objecting to such a change being exempted from any “enhanced cooperation” that would be switched from unanimity to qualified-majority voting. In short, the precedents of the Schengen Agreement and the European Stability Pact, which are not incompatible with federalism, could be followed. In terms of such competencies of the E.U. that would be added to those that are already subject to qualified-majority voting, states like Hungary and Slovakia could be exempted. This is not to say that there would be a union, such as the “EU-26,” within the union, or a foreign policy union, a defense union, and so on. Such jargon, as well as the euphemistic-sounding “enhanced cooperation” and, even worse, “multi-speed bloc,” only obscures the point that in a federal system, states can be exempted from particular federal legislation (and policies) without the federal system itself being nullified. Also, to refer to exempting certain states as allowing for “voluntary co-operation” in “coalitions of the willing” is also misleading because there is nothing voluntary about being subject to qualified-majority voting on an E.U. competency manifesting as law. Reducing the E.U. to voluntary cooperation and coalitions of the willing undermines the European Union itself by detracting from what strength it does have as a “true federal union.” The extent of vacuous, ideological jargon outdoes even that of the American retail sector, in which customers are called “guests” and even “members,” customer orders are considered “perfect,” and one of the official public holidays is singled out intentionally to be (ideologically) obscured passive-aggressively as “happy holidays.” But I digress.

To be sure, within the E.U., the state-veto has been seen by some people as “the last resort to protect” state rights.[8] Tamás Lattmann, an international-law expert, said, “A veto power is the last line of defence of vital interests. Every case of circumvention has led to a set of new problems, often the inoperability or discrediting of the system itself.”[9] However, that states could be exempted means that their vital interests would not be threatened. Also, exempting states would not discredit the E.U.’s federal system. In fact, the U.S. federal system could arguably benefit by being more flexible, as so much governmental power has been federalized and “one size does not fit all” in an empire-scale federal union, whether in North America or Europe.

The argument that the state-veto “serves as an equalizer between smaller and larger member states” has also been made, especially because the European Parliament has representation by population.[10] During its debt crisis, for example, the state of Greece could have made the case that E.U. policy reflected the interests of German creditors to the extent that even the anti-austerity party was pressured to accept continued austerity. Furthermore, the smaller eastern states could legitimately argue that the large states in the west have disproportionate (even in terms of the population part of qualified majority voting) informal as well as formal power. The problem is in relying on a mechanism, the state veto, that has been such a detriment to the enactment of federal policy and law.  In the U.S. Senate, which was established principally to safeguard the interests of the small member states, the filibuster, which can be overridden by 60 votes (out of 100), is typically viewed as sufficient for the minority on any given question. To be sure, a minority is not the same as one state. In E.U. competencies subject to qualified majority voting, a single state, whether large or small, could vote no and yet be subject to a federal policy or law. The case of tariffs on Chinese imports was a case in point in 2025. If the filibuster mechanism is sufficient protection for small states in a legislative chamber in which each state has the same number of votes, then the number-of-states set at 65% in qualified majority voting could be deemed sufficient. Generally speaking, a majority of 65 percent has more democratic legitimacy than does a simple majority—a point that Americans might want to consider.

In conclusion, the Commission and Council could hardly be blamed for trying to obviate the state-veto without subjecting objecting states, for their vital interests are untouched because they are exempted. With enlargement of the Union being an issue, as well as the need for federalized defense and foreign policies given the military aggression of Russia and even Israel, the Union could no longer afford the veto-mechanism itself even by 2023. The mechanism actually pertains to confederalism, in which governmental sovereignty is retained by the states, rather than to modern federalism, in which the atom of governmental sovereignty is split, though not necessarily evenly, in a federal system between the states and the federal level. That the E.U., even initially in 1993, has the salient feature of dual sovereignty means that that union has never been a mere confederal system; the E.U. is thus well-within being a “true federal union.” Even though it has been in the interest of E.U. officials to appease Euroskeptics so to as to render them more docile, ideological denial has cost the European project severely, and the state-veto has played a major role in the self-inflicted federal impotency.

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1. Sandor Zsiros, “The EU Wants to End the Era of National Vetoes—But It’s Complicated,” Euronews.com, 23 December, 2025.
2. Ibid.
3. Ibid.
4. Ibid.
5. Ibid.
6. Ibid.
7. Ibid.
8. Ibid.
9. Ibid.
10. Ibid.

U.S. Presidential Encroachment on State Prerogatives

Both in the E.U. and U.S., the member-states are semi-sovereign, and are even guaranteed all residual sovereignty that is not in any of the enumerated competencies (i.e., powers) of the respective unions and the states. Europeans are smart to have multiple avenues for the state governments in the European Council and the Council of Ministers so those governments can protect themselves against encroachment by the Commission. To be sure, these safeguards go too far, especially given the sheer number of states even by the mid-2020s, in giving each state a veto especially on important matters in which qualified-majority voting does not apply. In other words, the safeguards against federal encroachment in the E.U. are excessive as long as each state can wield its veto against federal policies, legislation, and regulations. Regarding the latter, the directive means provides each state with some latitude. I suspect that the Europeans who constructed the E.U.’s federal system were in part fearful of federal encroachment because so much of that had already built-up in the U.S., where federal consolidation had become a threat to the governmental sovereignty of the member-states, as if they were just regions rather than republics holding even more sovereignty, on parchment at least, than does Congress and the federal president. So, it is worth taking not of the rare instances in which a state legislature pushes back against threats from the U.S. president on a competency (i.e., enumerated power) reserved by the states.  The rejection by the Indiana Senate of U.S. President Trump’s pressure to accept new districts for U.S. House representatives from Indiana—a map in which the Republican Group would likely pick up two seats—is important because Congressional-district maps are the prerogative of the states rather than an encroaching federal executive.

According to Article 1, Section 4 of the U.S. basic law (consolidated as a constitution), the member-states have the primary authority to regulate the “times, places, and manner” of the U.S. House or Representatives’ elections. This authority includes enacting the boundaries of the districts within a state. To be sure, Congress has been delegated authority to override a state’s Congressional-district map, as federal oversight is in line with the “checks and balances” feature of modern federalism. For instance, a state’s map that discriminates against regions populated mostly by a racial minority would be ripe for Congressional action. It is significant that the U.S. president plays no role either in crafting such maps or in oversight. Therefore, U.S. President Trump’s threats laid against certain senators in the Indiana Senate so they would pass a new Congressional map before the next census so to give Trump’s Republican group in the U.S. House of Representatives more representation than otherwise would likely be the case was a case of federal encroachment of a state power encased in the U.S. Constitution. The Indiana senators voted prudently and justifiably in rejecting the U.S. President’s “bully tactics.”

Senator Michael Crider, a Republican, who faced “threats of violence and intimidation,” issued a statement after he voted no on the redistricting proposal.[1] “When you get kind of bullied and threatened, if that tactic works, then you can expect to deal with that for the rest of your political career.”[2] Sen. Vaneta Becker issued the following statement: “I think this looks like and feels like bullying, and I don’t think Hoosiers respond well to bullying.”[3] Neither, I might add, do Illinoisians on the other side of the Wabash river, to whom people from the Indiana side of the river-border used to shout, “Whos you’r,” hence the mascot, “Hoosier”, instead of who are you?

The same consequences of giving into a bully can be said of a state legislature; once it capitulates to threats and pressure from the federal executive (or Congress), threats will be more likely to continue and even become more dire until the member-state legislators are afraid to use even the powers reserved for the states. In the case of the redistricting plan, President Trump even threatened the Indiana government that federal funds would be cut off from the state in retaliation for not approving the president’s partisan plan. Sen. Spencer Deery made the problem of encroachment on the state explicit: “As long as I have breath, I will use my voice to resist a federal government that attempts to bully, direct and control this state or any state. Giving the federal government more power is not conservative.”[4] That a prerogative of a state legislature could be circumvented “at the whim of a president’s request” was too much for Sen. Mike Bohacek too.[5] Therefore, both in terms of threatening Indiana lawmakers, who have been democratically elected, and in terms of eclipsing federalism, wherein the vital element of checks-and-balances between the federal institutions and those of states, the political courage of the Indiana Republican senators who voted against President Trump’s partisan plan is laudable. Threats of violence have no place in politics, and efforts to usurp the governmental sovereignty that is reserved for the states, whether in the U.S. or E.U., should be resisted lest the check-and-balance “oversight” feature of modern, dual-sovereignty, federalism be lost.

Fortunately, the “acts of intimidation and threats and acts of violence targeting [Republican Indiana] senators who opposed” the proposal backfired, as a majority of the 40 Republican senators voted against the bill.[6] Ironically, politically conservative principles were cited by some of those senators. The head of the Republican Group in the Indiana Senate, Sen. Rodric Bray, said, “many of my caucus members don’t think redrawing our Congressional map mid-cycle is a guaranteed way for Indiana.”[7] In short, changing maps for partisan purposes mid-way through a decade violates the tradition of redrawing maps only just after the U.S. census, which occurs once every decade. As per conservative principles, Bray urged Republicans to campaign more so as to sway a district that was then held by a Democrat but becoming increasingly Republican. As the saying goes, elections have consequences.

 

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1. Paul Blumenthal, “These Are The Indiana Republicans Who Voted To Crush Trump’s Redistricting Plan,” The Huffington Post, December 12, 2025.
2. Ibid.
3. Ibid.
4. Ibid.
5. Ibid.
6. Ibid.
7. Ibid.

A Reparations Loan or Common Debt: Undercut by State Rights

“State rights” was a common refrain by the eleven U.S. member states who sought to exit in 1861; the underlying fear was that the exclusive competencies, or enumerated powers, of the U.S., combined with the numerous accessions of new states, were already compromising the power of the eleven states to protect their economies from “encroachment.” In 1858, for instance, a tariff disadvantageous to those economies had been passed in spite of the “Southern” objections in the U.S. Senate. Had each member state had a veto, rather than just the ability to filibuster, the eleven states would have been able to protect the viability of their respective economies from encroachment by the Union. To be sure, the state rights claim that the U.S. was still just a bloc, as had been the case from 1781-1789 under the Articles of Confederation, was sheer denial, for the U.S. Constitution instituted a new kind of federalism—partly national, partly international—based on dual sovereignty, wherein both the member states and the Union have a portion of governmental sovereignty. It is this form of federalism, “modern federalism,” that the Europeans adopted in creating the European Union because the E.U. has exclusive competencies. But whereas the shift made by the Americans in the eighteenth century left the state-veto behind at the Union level, the Europeans retained the veto, which at the very least works against the effective operation of modern federalism. The arduous and much delayed task on a reparations loan for Ukraine in spite of the self-interested objection—and thus promised veto—of one state is a case in point. Even the alternative of the E.U. issuing debt faced state-level opposition, as was the case in the U.S. in the 1790s, but in that case, the self-interested states that were relatively clear of debt could not stop the issuance because none of those states could wield a veto at the federal level. This is important because back then, the American states were still widely viewed as countries by their respective inhabitants. “I must fight for my country,” General Lee told Lincoln in 1861, referring to Virginia. A refresher on American history could help Europeans cross the Rubicon to a more internally consistent modern federalism. Whether Euroskepticism or States’ Rights, the ideology, as etched into the E.U.’s Basic Law, is responsible for Van der Leyen’s headaches in getting the E.U. to put Ukraine in a position of strength against the Russian invaders.

A Union of states that allows a self-interested state to block federal action that is in the good of the whole Union is weak. So, when Ursula von der Leyen said late in 2025 that the European Commission would provide Belgium with sweeping guarantees to unblock a controversial reparations loan for Ukraine, a state official representing Belgium countered that the Commission’s proposals “do not address our concerns in a satisfactory manner. It is not acceptable to use the money and leave us alone facing the risks.”[1] That Belgium’s government could wield its veto gives “not acceptable” the ring of finality. This is despite the guarantees for Belgium consisting “of bilateral contributions by member states, a backstop by the EU budget, legal safeguards against retaliation and a new prohibition on transferring sovereign assets back to Russia.”[2] Experts could of course weigh in on how failproof these guarantees actually would be.

From the perspective of the E.U.’s federal system, the following statement made by President Von der Leyen is crucial: “We have created a very strong solidarity mechanism where in the very end the Union can intervene, because we want to make very sure to all our member states, but specifically also to Belgium, that we will share the burden in a fair way, as it is the European way.”[3] The problem is that to state officials, relying only on “the European way” was insufficient; the veto in the European Council and the Council of Ministers was also felt to be necessary for self-protection. Hence Belgium’s language includes “not acceptable.” Mistrust of the E.U. may be behind at least some of the resistance of the states to agree to an expansion of qualified majority voting.

For the eleven U.S. member states who tried in vain to exit the U.S. in 1861, another kind of qualified majority voting in the U.S. Senate was deemed to be insufficient to safeguard the Southern agrarian economies based on Plantation-level slave-labor. But for the E.U.’s state-veto, we have to go back to the disastrous Articles of Confederation Between the Several States, wherein the U.S. depended on voluntary financial contributions from the states and there was no common debt. The state-veto that is justified in confederal systems by the fact that all of the governmental sovereignty is retained by the states is toxic in modern federalism because the federal level is too prone to being hamstrung even with regard to proposals that are in the interests of the whole even if not in the self-interest of each and every state. A part should not be able to upend the common good.

That Von der Leyen had to go to such lengths that Belgium would have guarantees for its financial interest in attracting sovereign wealth funds in the future is indicative of just how toxic the state-veto mechanism is, especially when Russia was succeeding in invading Ukraine for years by the end of 2025 when the E.U. was yet again proposing a reparations loan (or common debt). This point alone should disabuse any State Rights folks from clutching so tight to the veto. Also, in a union of states, sometimes a state “takes one for the team.” This is true solidarity. “Man up,” may be the relevant expression, given Belgium’s intransigence, but, then again, I’m an American, hence rather crude and thus unbecoming at a European dinner party. “Lose the veto, guys,” I would readily and flatly say amid polite, too polished conversation.

The problem is that no one likes to give up power unless in a crisis, and an invasion to the east is evidently not a crisis. It may be that, like the Schengen Agreement and the Stability Pact, an exogenous “more closer union” may need to be formed by the more federalist-leaning states, sans the sordid veto, for another budget as well as foreign and defense policy. Instead of the 55% in qualified-majority voting (QMV), perhaps 60%, which matches the percent needed in the U.S. Senate to overcome a filibuster, could be used as a compromise. This is not to say that the E.U. and U.S. should converge; the Europeans are smart to fear the sort of consolidation at the Union level that eclipses any sort of federalism, and thus needed space for the states to act as per their respective cultures and ideologies. The American case clearly demonstrates that a citizenry giving primary loyalty to the state level cannot be relied upon as a safeguard in the distant future against creeping encroachments by the Union on the sovereignty retained by the member states. Even so, whereas the U.S. by 2025 had lapsed too close to consolidation at the expense of federalism, the E.U. risked dissolution by states plying themselves away from an ineffectual, internally hamstrung Union, for no one likes to be a part of self-inflicted weakness. Nietzsche taught us this.

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1. Jorge Liboreiro, “Von der Leyen Pushes Ahead with Reparations Loan for Ukraine as Belgium Maintains Its Opposition,” Euronews.com, December 3, 2025.
2. Ibid.
3. Ibid.

E.U. Citizens on the Union’s Enlargement

Having recently been presented with an E.U. citizen denying the E.U. has citizens even as he admitted that he could vote for a candidate to represent him in the European Parliament, I had my faith in human rationality restored the following day in reading of a poll of E.U. citizens on whether additional states should be added to the Union; ideology, even of the tribal sort, need not distort rationality beyond recognition. Even in the reporting of such a poll, however, the Euroskeptic, or states’ rights, ideology left its imprint. Even such an auxiliary presence is a sign of the headwind that has been facing the E.U. since its founding.

Euronews reported on 28 October, 2025 that 56% of E.U. citizens approved of adding new states. “Young Europeans in particular support enlargement. 67% of 15-24 year olds are in favour, ahead of 25-39 year olds at 63%.”[1] If the young adults maintain their optimism in the decades to come, we could expect the power of the Euroskeptic, states’ rights (i.e., anti-federalist) ideology to lessen over time. This in turn could allow the E.U. to accumulate enough additional enumerated powers, or exclusive and even shared competencies, so the benefits of united action could be realized more fully, especially in the domains of foreign policy and defense. As of 2025, it has been as if state officials had tied one arm behind the E.U.’s back even regarding existing federal competencies. The poll indicates that this could change.

The poll can also be taken as an argument for a more vigorous education prior to university and trade school, for the support for enlargement “comes to a large extent from young people and educated people.”[2] To be sure, an educated person could argue that because of the unwillingness of enough state governments to delegate additionally competencies (or even just strength those that the E.U. already had), the veto mechanism enjoyed by each state should be more restricted before additional states are annexed to the Union. It is possible, for example, to up the double majorities from 55% to 60% on major pieces of federal legislation, in place of keeping the veto-mechanism in place. Even at 27 states, unanimity is unrealistic; it could therefore be unrealistic to expect unanimous agreement with there being even more states in the Union.

The force behind retaining the veto-mechanism in the European Council and the Council of the E.U. is none other than the Euroskeptic, or states’ rights ideology that is just fine with allowing even small states to block proposed legislation even if it is in the interest of the Union as a whole. In the twentieth century, that ideology manifests as strident nationalism, which of course gave rise to war on more than one occasion. Unfortunately, old ideologies die hard even in the face of the fact of political development, such as that of several states forming a federal union of states. Such a development, especially after several decades, inherent relativizes otherwise unmitigated pro-state-oriented ideology.

That ideology is to some extend built into the poll, according to which “the most supportive Member States are Sweden (79%), Denmark (75%) and Lithuania (74%). Conversely, Austria (45%), the Czech Republic (43%) and France (43%) are the least supportive” of enlargement.[3] Although admittedly much daylight exists between 79% and 43%, and pro-E.U. advertising could be directed by the Commission to run in local media in the least supportive states on the basis of this way of dividing up the results, reporting by state is itself a reinforcement of the state-centric, Euroskeptic ideology that has held the federal legislative and executive branches back even from being able to fully exercise its enumerated powers, or competencies.

On May 1, 2025 at Yale, I met the E.U.’s ambassador to the U.S. after her talk. I pointed out that the media in the E.U. labeling the Union as a mere bloc as if the E.U. were only active in one power-domain and were temporary, was subtly undermining the E.U. itself and fortifying the Euroskeptics. To my surprise, she agreed with me, but my feedback had zero impact.  She told me that just admitting even that the E.U. has a federal structure would enrage powerful Euroskeptic officials in some states, such as Hungary. As a result, however, more uneducated Europeans could be expected to conflate the “bloc” with international organizations such as NATO and the UN, and the poll supports this point. Why expand something as weak as a bloc?

On October 24, 2025, an Oxford professor of political economy spoke at Harvard’s Center for European Studies. Whereas Yale’s Center acknowledges and so includes talks on the E.U. being intergovernmental relations only, Harvard’s political economists have been stuck in the political economy paradigm of Europe prior to the founding of the E.U. in the early 1990s. So, the professor from Oxford presented a European poll in which both the E.U. itself and the related impact of European cultural integration from the states being in a federal system were ignored. Instead, he (or the discussant) insisted that Denmark and Sweden are so different with respect to how the poor view public policy that is oriented to reducing economic inequality, even though both northern states are Scandinavian and have relatively low economic inequality, whereas every rural American is a libertarian against constraints on rising economic inequality. In other words, the interstate cultural differences are magnified when it comes to the E.U., while such interstate (mostly non-linguistic-based) differences in the U.S. are virtually ignored as if one cultural attitude spans across a continent. The European states’ rights, or nationalistic, ideology can be so exaggerated that cognition is twisted even in the minds of scholars! Unfortunately, the E.U. itself has been paying the price for this ideological denial; it is not just an artifact of ideology under the subterfuge of scholarship. Ironically, as long as the E.U. continues to pay the price from being reckoned by enough uneducated European citizens as merely a bloc (or even as nonexistent), enlargement by the accession of additional states without basic reform of the federal system would be likely to compound paralysis rather than increase the Union’s strength.

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1. Gregoire Lory, “56% of Citizens Support EU Enlargement, New Eurobarometer Poll Shows,” Euronews.com. 28 October, 2025.
2. Ibid.
3. Ibid.

Strength in Numbers: The European Union in Foreign Policy

One of the chief benefits of having an empire-scale union of states is the sway, or influence, abroad that comes with strength of numbers. Dwarfing the foreign-policy of a state government, and even of an informal bloc of a few states plus others outside the union, an empire-scale united-policy enacted to influence other countries can make the delegation of the additional governmental sovereignty to the federal level worth losing some state power abroad. I contend that this lesson can be gained by examining the European-Russian relation during the month of May in 2025.

On May 14, 2025, the E.U. “agreed to impose a new round of sanctions against Russia, threatening to slap on another one if the country continues to refuse the 30-day unconditional ceasefire proposed by the White House and the ‘Coalition of the Willing’.”[1] The White House refers to the U.S., another empire-scale union of states, but the “coalition” is a more nebulous construction; it consisted of three E.U. states plus Britain, which had seceded from the E.U. and was thus separate. One of those states, Germany, threatened Russia with immediate sanctions only to see Putin continue his military invasion of Ukraine. When a person’s “line in the sand” is so easily and quickly crossed, that person should re-evaluate one’s own vantage-point for what it is. Even a small bloc of states plus a former state is not sufficient to stop a Russian bear in its tracks. It is no accident, therefore, that the E.U. lost little time in announcing its own sanctions against Russia. The lesson is that the state leaders should have put the E.U. commission in the driver’s seat in the first place, rather than demonstrate the need for collective action that the E.U. could provide.

Macron of the E.U. state of France said on May 12, 2025 that an “unconditional ceasefire is not preceded by negotiations” but he could do little to back up that statement, given that Putin had just dismissed an immediate unconditional ceasefire without paying any price.[2] That an informal coalition, or bloc, had “previously demanded a full ceasefire a precondition to starting negotiations” meant nothing to Putin.[3] Continuing to make military progress on the ground in Ukraine, he had no incentive to respond to the bloc, but to the extent that Russia could suffer from sanctions from the E.U., Putin would have more reason to take an ultimatum seriously.

That the governors of three E.U. states chose to exercise their retained power in foreign policy rather than go through the Commission points to a vulnerability of the European Union from foreign policy being a shared competency while the state governments hold most of the governmental sovereignty in the union. It is very tempting to a state leader to grab media attention by taking the lead in a foreign policy that the E.U. could do with more power internationally.

There is also the conflict of interest in a bottom-heavy federal system wherein state leaders resist delegating enough authority to the federal level so it can function effectively, especially with regard to international relations. The E.U. had a foreign minister at the time, and a federal president, and yet three state leaders decided to spearhead a push for Russia to agree to an immediate ceasefire anyway. Their approach was doomed from the start because Russia could easily dismiss the threats from a few states even though the U.S. was on board on an immediate ceasefire.

So, it is problematic that once the E.U. effectively took over from the bloc of a few states, the need for the state level institutions to take a lesson and be willing to give the E.U. more authority to make and enforce foreign policy, as by applying qualified-majority voting to such policy, was not grasped in the public media and discourse. Lest there be any doubt concerning the power of a small bloc of (large) E.U. states, Dmitry Medvedev wrote on social media: “Macron, Metz, Starmer and Tusk were supposed to discuss peace in Kyiv. Instead, they are blurting out threats against Russia . . . You think that’s smart, eh? Shove these peace plans up your pangender arses.”[4] Ouch!  I submit that the E.U. announcing additional sanctions would not be taken as the blurting out of threats was taken, in part because of the much greater power of the E.U. vis á vis Russia. Macron, Metz, and Tusk looked like the three musketeers, with Starmer as a former fourth, relative to the E.U.’s institutions.

Unfortunately, the state level of governance had held back those institutions from being able to leverage the “power in numbers” in foreign policy that could otherwise be realized by the Commission with oversight by the Parliament and the European Court of Justice, and with a check by the involvement of the states at the federal level. Too much of a check by the latter, including taking the lead and ignoring the shared competency of the Commission, was detracting not only from a more perfect union, but one that could have enough sway internationally to operate as a real check on Russia as well as Israel.

Put another way, as the Trump administration was warming up to Russia and Israel, the world could ill-afford to have the Europeans resorting to informal blocs of a few E.U. states due to institutional clutching of power at the state level and a lack of leadership there for the good of the whole (E.U.) over state politicians’ self-interest for power and stardom. The breakdown of the international order, with the UN being politically impotent to stop Russia or Israel in their excessive aggression, means that Europeans could ill-afford continuing to allow their state officials to styme action at the E.U. level on the world stage.

Euroskeptics have feared the advent of a huge “federal state” without realizing that hamstringing E.U. institutions on competencies that are shared with the states only hurts the European Union itself. In other words, compromising a federal system because it is wrongly assumed that for such a system to exist (and thus that the E.U.’s system has not been federal from the start), there must be a massive state at the top, leaves Europe vulnerable to a real massive state—that of Russia.

This is not to say that Europe must also have a massive state; ironically, that the E.U. has a federal system enables there not to be a massive state covering the E.U.’s territory, for dual-sovereignty can and should be balanced such that neither the federal nor the state level dominates the whole federal system. In his book, Federal Government, Ken Wheare denies that such a balance is necessary to an ongoing and stable federal system of checks and balances. I disagree. Under his theory, the federal level of the E.U. could gain so much authority that the state governments are utterly dominated and still the federal system would work. I disagree. Whereas the U.S. federalism could be better balanced by having the states empowered to act as a check on the federal institutions, E.U. federalism could be better balanced by having the federal level gain additional competencies, with the states benefitting from the resulting collective action while still having enough sovereignty to check the federal institutions. Whereas the U.S. could benefit by increasing the formal involvement of the state governments in foreign policy in Washington, the E.U. could benefit by increasing the formal involvement of the E.U.’s president and foreign minister in crafting and enforcing foreign policy to defend Europe from aggressive powers abroad, whether they are empires in themselves or sovereign states.

It is telling that a year before Macron returned to his state capital of Paris empty-handed (just as Merz headed back to Berlin empty-handed) after Putin had dismissed the state-level demand for a ceasefire in Ukraine, Macron had given a major speech on the need for Europe to defend itself. “In the next decade,” he had said, “the risk is immense that [Europe] will be weakened, even relegated.”[5] The clear conclusion for us in contrasting those two events is that the state governments should formally allow the E.U. to take the lead in foreign policy rather than have state leaders attempt to “steal the thunder” by charging out in front as if by instinct with the federal officials tasked with foreign policy only able to look on. Yes, Virginia, the E.U. does indeed have a federal system, but this does not mean that transferring more governmental sovereignty on foreign policy (and defense) to the federal level would necessarily turn Europe into a federal state as Euroskeptics fear; the sort of federal consolidation that has occurred over centuries in the U.S. can be avoided even as Europeans lend greater balance to the E.U.’s federal system.

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1. Jorge Liboreiro, “EU Agrees New Sanctions on Russia and Threatens More If Putin Refuses Ceasefire,” Euronews.com, 14 May 2025.
2. Ibid.
3. Ibid.
4. Shaun Walker, “Vladimir Putin Rejects Ceasefire Ultimatum Proposed by European Leaders,” The Guardian, May 10, 2025.
5. Clea Caulcutt, “Macron Warns Europe ‘Can Die’ in Alarmist Speech on Protectionism, Geopolitical Threats,” Politico.com, April 25, 2024.

A European Army: A More Perfect Union

At the Munich Security Conference in February, 2025, Ukraine’s President Zelenskyy bluntly asserted, “I really believe that the time has come that the armed forces of Europe must be created.”[1] He could have said in 2023 after Russia’s President Putin had sent tanks and bombs into Ukraine; instead, the inauguration of President Trump in the U.S. that was the trigger. “Let’s be honest,” Zelenskyy continued, “now we can’t rule out that America might say ‘no’ to Europe on issues that might threaten it.”[2] At the time, Trump was planning to meet with Putin to end the war without Britain and a number of E.U. states at the table. After all, they had failed to push Putin off Crimea in 2014, and even in 2025, they were not on the same page on how to defend Ukraine militarily. Amid the political fracturing in Europe, Ukraine’s president was urging that the E.U. itself have an army, rather than merely the 60,000 troops for which the union was dependent on the states. Even on being able to borrow on its own authority, the E.U. was hamstrung by the state governments that were more interested in retaining power than in benefitting from collective action. It is difficult to analyze Zelenskyy’s plea without including the anti-federalist, Euroskeptic ideology that was still eclipsing the E.U. from realizing a more perfect union.

 

The full essay is at "A European Army."

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1. Joshua Posaner, “Zelenskyy: ‘The Time Has Come’ for a European Army,” Politico, February 15, 2025.

2. Ibid.

The E.U. Says No to Hungarian Asylum Detention Camps: A Test for E.U. Federalism

On May 11, 2020, the European Court of Justice (ECJ), the E.U.’s highest court, ruled against the state of Hungary on its detention camp near the Serbian border. The state had denied the asylum requests because the immigrants had come through Serbia, and the latter refused to allow them to reverse course. The immigrants were thus stuck, essentially detained in “prison-like conditions.”[1] The high court ruled that the “conditions prevailing in the Roszke transit zone amount to a deprivation of liberty.”[2] ECJ Advocate General Priit Pikamae had argued that the “unlawful detention” was due to the “high degree of restriction of the freedom of movement.”[3] The state of Hungary had argued that the immigrants could have stayed in Servia, as it was a safe-country of transit, and thus were not eligible for asylum in Hungary. Unlike Hungary, Serbia was not an E.U. state, which may be why the asylum-seekers did not want to remain in Serbia. Hence being a border state added to Hungary’s woes. Therefore, the E.U. had some responsibility to alleviate the pressure on Hungary. Yet the Union did not do so, showing its weakness, and yet the state government bowed to the ECJ’s ruling. To the extent that the E.U. relies on such self-subordination in the want of federal help, the E.U. could be said to be on borrowed time during which basic adjustments to the federal system could be made.

As a border-state of the E.U., Hungary doubtless felt that it could be overwhelmed by asylum-seekers from the Middle East. This set the state’s particular interest at odds with the common interest of the Union because Hungary and other border states would bear the disproportionate weight of the waves of asylum-seekers in the late 2010s. Even though the state’s prime minister, Viktor Orban, was a Euroskeptic, or state rights proponent, and thus especially oriented to his state’s interests, he bowed to the federal court’s ruling, and thus authority. “The Hungarian government disagrees with the ruling, we consider it a risk with regard to European security, but as an EU member state, we will adhere to all court rulings,” Gergely Gulyas, a government spokesman, said at the time.[4]  Even though the E.U. had not come in to solve the intractable problem of the camps, the Euroskeptic state would act according to the ruling of the federal supreme court. This may mean that the E.U.’s federal system had strength at the state level in spite of weakness in united action for the whole—that is, more strength than the Union deserved.

Generally speaking, a federal system is internally vulnerable, and thus weak, to the extent that it must rely on the voluntary subordination of the state governments who must nevertheless suffer from insufficient federal power to redress Union-related state problems. To be sure, a federal system is weak if the states recognize federal authority only when it suits them. Hence the U.S. federal government acted against the state of South Carolina in 1832 after it passed a law invalidating any federal law in the state that goes against the state’s interest. Yet if state governments suffer enough adverse federal judicial decisions without federal help with problems that are acute at the state level (especially if acute because the state is in the federal system), then at some point secessions may result in the dissolution of the federal system.

In the E.U., the federal level was at the time still too hamstrung by overarching state power to be able to act sufficiently even to help particular states on problems stemming from the states’ respective roles or situs in the Union. For example, any state government could veto the proposed law to help the most economically distressed states financially in the midst of the coronavirus pandemic. The power of the states generally is made worse by the strangle-hold that the most powerful states had over the federal level (think Germany and France). Money would not be allocated for the E.U. to deal with the asylum-seekers in Hungary’s detention camps if the most dominant state governments did not agree that the common interest in doing so was worth it to those states. To the extent that the most powerful states could effectively use federal institutions in line those states’ own interests even at the expense of common problems, other states, such as Hungary, would naturally be Euroskeptic. For such a state to recognize an ECJ ruling averse to the state’s interests anyway is surely laudable, even if it buys the Union added time to redress the problem of the imbalance of power between the federal and state levels.

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[1] Deutsche Welle, “Hungary Illegally Held Asylum-Seekers, ECJ Rules,” DW.com, May 14, 2020 (accessed May 22, 2020).

[2] Ibid.

[3] Ibid.

[4] Deutsche Welle, “Hungary to Close Transit Zone Camps for Asylum-Seekers,” DW.com, May 21, 2020 (accessed May 22, 2020).

An E.U. Economic Recovery Fund: A Federal Problem

On May 18, 2020, with the E.U. Commission having been no match for the states’ own interests in their own health and economic crises, the governors of France and Germany announced that they would support a recovery fund to help the states most in need. The €500 billion fund of grants (not loans) would be raised on the capital markets and guaranteed by the state governments. It would be part of the federal budget.[1] I submit that the imbalance in that federal system is evident; here again, the power of the state governments relative to the federal Commission shows the weakness of the latter.

Not coincidentally, the governors’ joint announcement fit nicely with the proposal yet to be unveiled by the European Commission. Because the fund would be part of the federal budget, a federal institution (i.e., the Commission) should arguably have made its announcement prior to that of the two state executives. That the state-level took the lead on a federal program suggests that the federal level was itself relatively weak. It is telling that had the Commission gone first, the state governments would likely have ignored the proposal.

Yet to rely on the largest states to act de facto as the federal level makes the Union vulnerable to the common interests being subject to the particular interests of the most powerful states. It is no accident that the Commission would use “the argument that the fund is an exercise in common self-interest.”[2] The other states would rightly have been suspicious had France and Germany used that argument. So we have the pertinent argument to be made by the Commission only in retrospect. This in itself may point to how important the common interest actually has been in a Union whose legitimacy is based precisely on common interest.

To be viable in the long-term, a federal system must maintain a balance of power between the federal and state levels. Too much federal power and the system consolidates; too much state power and the risk is dissolution of the federal system. Short of dissolution, a state-heavy federal system pays too much heed to the particular interests of states and can even be dominated by the most powerful state (or states). Throughout its entire history as of 2020, the E.U. suffered from this imbalance. The want of federal power to provide a check on excessive state power over federal institutions and the Union itself was evident, for example, as rich Northern states were able to thwart federal efforts to mitigate the austerity of heavily indebted states such as Greece and Spain after the financial crisis of 2008.

Efforts to minimize redistribution within a federal system, moreover, reflect a minimal notion of the common interest. While such a view is consistent with a confederation in which all of the sovereignty resides with the states, the minimal approach can stifle a federal government’s use of its portion (or competencies) of sovereignty, which in turn should match the common interests with which the federation is tasked. Having a federal currency, for instance, implies the need for monetary and even fiscal policy for stabilization purposes. Hence the Commission was set to argue that the Eurozone itself could be destabilized if an uneven economic recovery were to occur after the coronavirus pandemic. Hence the need for the redistributive recovery fund. To have established the common currency and yet insist on a minimal notion of common interest is self-contradictory because having such a currency expands the common interest. In other words, to give federal governmental institutions competencies geared to protecting or furthering the common interest and then narrowing it to bind the federal use of the competencies essentially ties the federal level in knots. While this strategy may be in the immediate interests of the states (especially the most powerful) in holding back any possible federal encroachment, the federal system itself suffers from the want of federal power, given its competencies.

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[1] Katya Adler, “Politics and PR: Behind the Scenes of Franco-German Recovery Fund,” BBC.com, May 18, 2020.

[2] Ibid.

Monetary and Fiscal Policy and Structural Reform: Each Had a Role to Play after the Financial Crisis

With fiscal policy hamstrung by public debt in both the E.U. and U.S., monetary policy was a major beneficiary of the financial crisis of 2008 and the ensuing state-debt crisis that stammered on at least until 2013 in Europe. Lest it be concluded that central bank policy had reached an unassailable peak of salvation, the expanded role actually made its limitations transparent, at least in financial circles.
Speaking to Charlie Rose on March 11, 2013, Jeremy Grantham of a Wall Street firm argued that the U.S. Federal Reserve Bank's extremely low interest-rate policy would be unlikely to spark an increase in employment even in the severe recession following the financial crisis. In fact, a low interest rate is a transfer of wealth from the poor to the rich. Fiscal policy, such as the Conservation Civilians Corps of U.S. President Franklin Roosevelt's New Deal in the 1930s, is a much better tool to achieve full employment. Yet even the New Deal did not have enough fire-power to bring the U.S. economy out of the Great Depression; it took the breaking out of a second world war to get America's military-industrial complex to create enough jobs. One implication is that a competitive market alone is not sufficient to reach full employment. Even though such a market can sport great efficiency if kept competitive by the enforcement of anti-trust law, natural consumption levels have been unable to spark enough jobs for full employment to be achieved. Not even low interest rates can do that, as per the decade of the 2010's. We ought to accept that a lot of fiscal stimulus is needed to achieve full employment, even if it is not optimally efficient. 
Meanwhile, Jens Weidmann, the president of the Bundesbank, argued that monetary policy in the E.U. “can only buy time at best..” He went on to say he was “a bit concerned about some of the expectations around the power and potential of monetary policy.”[1] In other words, the ECB should have gotten back to monetary policy in a stricter sense, rather than trying to spark economic growth and employment through low interest rates and buying state-government bonds.
Behind the view of interest-rate, or monetary, policy as being capable of giving us economic salvation was the paralysis of fiscal policy determination in both federal unions.  Divided government at the federal level stymied fiscal policy in the U.S. after President Obama’s insufficient “stimulus” package in 2010. In the E.U., the vetoes retained by the fiscally- and debt-conservative state governments such as Germany at the federal level through the European Council put pressure on state governments strapped fiscally to take on even more debt even just to avoid defaulting on existing debt, not to mention keeping their fiscal policy-levels sufficient that their residents would not be imperiled. Increasing debt-loads for fiscal reasons did not serve states like Greece and Spain well. Fiscal redistribution at the federal level is one of the benefits of federalism, and yet the E.U. was stymied because each state government had too much power at the federal level (quite unlike the states in the U.S. at its federal level). 
In short, much of the allure of monetary policy actually came from fiscal frustration at the federal levels of both unions. Alternatively, both fiscal and monetary policy could have been used, and pointed in the same direction: toward full employment. Using low interest rates and the issuance of debt, respectively, to pull up an economy out of severe recession and even as political coverage (in the U.S.) or leverage (in the E.U.) for needed structural reforms of a financial system and indebted states, respectively, may not have been sufficient or even smart. Taking on a corruption-induced financial system in the U.S. required a lot of political guts, which not even the Obama administration had, for the Dodd-Frank Act of 2010 did not go far enough in deconstructing the conflicts of interest in the system. Also, feeding Wall Street with infusions of government money appropriated by Congress and much more created by the Federal Reserve Bank, with no strings attached, did not make the bankers at the big banks any more willing to accept structural reforms even though they would have protected the banks by fixing the system. Not even fiscal stimulus plus low interest rates could keep the U.S. out of a severe recession, though arguably the U.S. could have entered a severe depression otherwise. Both fiscal and monetary policy and going politically after dysfunctional systems, whether that of Wall Street or those of heavily-indebted E.U. states, all must be used so none of the tools is over-relied upon and thus overused.  

See Institutional Conflicts of Interest, Essays on the Financial Crisis, and Essays on the E.U. Political Economy. All are available at Amazon.

1. Katy Barnato, “Central Banks Alone Can’t Fix Europe: Weidmann,” CNBC, March 12, 2013.  

President Trump’s Spending on a Border Wall: Federalism at Risk?

U.S. President Trump announced in February of 2019 that he would fully fund a wall on the U.S.’s southern border. He would first use the $1.375 granted by Congress to be followed by  $600 million from a Treasury Department asset-foreclosure fund for law enforcement, $2.5 billion from a military anti-drug account, and $3.6 billion in military construction funds.[1] The president’s rationale hinged on his declaration of a national emergency due to illegal immigration, drug-traffic, and crime/gangs—all having been coming across the border on a regular basis. In federal court, sixteen of the U.S.’s member-states challenged the president’s declaration and use of funds. The U.S. president’s legal authority to declare national emergencies was pitted against the authority of the U.S. House of Representatives to be the initiator of federal spending legislation. The House therefore had standing to sue. The question of the states’ legal standing is another matter. It is particularly interesting because it involved not only whether a given state would be harmed by the wall or even the president’s use of other funding sources that could otherwise be used for other projects in the states not directly affected by the wall, but also because federalism itself could be negatively affected in a way that harms all of the states.

Prime facie, it seems difficult that California and New Mexico could show injury from a wall that would not be built in either of those states. On this basis, the injury to Hawaii seems far-fetched, as the ocean functions as that republic’s border. Similarly, New York is nowhere near the U.S.’s southern border. Arguing, however, that “the president’s unconstitutional action could cause harms in many parts” of the U.S., California’s attorney general at the time insisted that the member-states had standing apart from where the wall would be built.[2] Given the sources of the funding, all of the states could “lose funding that they paid for with their tax dollars, money that was destined for drug interdiction or for the department of Defense for military men and woman and military installations,” he explained.[3] This point, I admit, is valid but it lacks a larger constitutional view.

In a federal system in which the member-states and federal governmental institutions both have their own basis of governmental sovereignty, a power-grab by one means less power for the other. The judicial trend since the war between the U.S.A. and C.S.A. during the first half of the 1860s has been to validate encroachments by the federal government on those of the states. President Trump’s decision to build a wall in some of the member-states represents a power-grab not only with respect to the Congress, but also the states. In the E.U., by contrast, the states have more say in how the E.U.’s border is protected. The European model of federalism values cooperation at both the policy and implementation stages than does the American model in which ambition is set to counter ambition.

The U.S. Senate was originally intended to be the access point in the federal government in which the state governments could affect or even block proposed federal legislation. When U.S. senators became popularly elected by voters in the respective states rather than appointed by the state governments, the latter lost their direct access in the federal government. Before then, a majority of states could defend not only their own interests, but also the interest of the state “level” in the federal system. It would be more difficult for the state governments to forestall encroachments (i.e., power-grabs) by the federal government. The federal system itself would suffer from a growing imbalance.

With the state governments no longer able to directly express themselves in the U.S. Senate because senators had an obvious incentive to satisfy constituent and especially financial-backer interests, going to the courts became the only route in trying to stop the federal president’s spending-plan for a wall. Yet even that strategy suffered from the institutional conflict of interest implicit in a federal court deciding disputes between the states and the federal government. Perhaps looking narrowly at anticipated injuries to the 16 states would attest to the federal-bias in the federal courts, which nonetheless have a responsibility to consider the standing that the states have in the federal system. After all, they rather than the federal government enjoy residual sovereignty. Is not a federal encroachment itself an injury to the state governments as per their loss of power? By the twenty-first century, the federal government could claim preemption in order to keep the governments of the states from legislating in an area of law even though the federal government does not intend to legislate in it! The danger in such an imbalanced federal system—that is, a lopsided system of governance—is that the encroaching government becomes tyrannical not just toward the states, but the People as well. As the power-checking-power mechanism breaks down, absolute power becomes increasingly likely.

For more comparisons of American and European federalism, see Essays on Two Federal Empires: Comparing the E.U. and U.S., and American and European Federalism: A Critique of Rick Perry's "Fed Up"!  Both are available at Amazon.

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1. Charlie Savage and Robert Pear, “States’ Lawsuit Aims to Thwart Emergency Bid,” The New York Times, February 19, 2019.

2. Ibid.

3. Ibid.