Power is shared under federalism by splitting authority between one national government and fifty state governments, with the U.S. Constitution assigning each level its own responsibilities and managing the overlap. Article I gives Congress a specific list of powers. The Tenth Amendment reserves everything else to the states or the people. Several other clauses handle the places where the two levels meet, conflict, or need to cooperate. Neither level holds absolute control, and the practical balance shifts over time through legislation, court decisions, and federal spending.
What Only the Federal Government Can Do
Article I, Section 8 lists the powers that belong to Congress alone. Collecting taxes, borrowing money, regulating commerce with foreign nations and among the states, setting rules for naturalization and bankruptcy, coining money, establishing post offices, declaring war, and raising and maintaining armed forces are all on that list.1Constitution Annotated. Article I Section 8 States cannot do any of these things on their own.
The last clause of Section 8, the Necessary and Proper Clause, lets Congress pass any law needed to carry out its listed responsibilities. In McCulloch v. Maryland (1819), the Supreme Court rejected the argument that “necessary” meant “absolutely indispensable,” reading it instead as “conducive to” or “needful” for executing a federal power.2Constitution Annotated. Necessary and Proper Clause Early Doctrine and McCulloch v Maryland That reading gave Congress room to act well beyond the strict letter of its enumerated powers and remains one of the most consequential federalism decisions on the books.
What States Keep
The Tenth Amendment draws the other boundary. Any power not given to the federal government and not specifically denied to the states belongs to the states or the people.3Constitution Annotated. Tenth Amendment Most of the governance that touches daily life comes from this space. States run elections, set up public schools, regulate marriage and divorce, license doctors and lawyers, create local governments, and regulate business conducted within their borders.
The Tenth Amendment also supports the anti-commandeering doctrine, established in New York v. United States (1992). Congress cannot order state governments to carry out a federal program. The Supreme Court extended the rule in Printz v. United States (1997), holding that Congress cannot conscript state officers to enforce federal law either.4Congress.gov. Anti-Commandeering Doctrine This comes up whenever Washington wants state help enforcing immigration, firearms, or drug policy. The federal government can offer incentives, but it cannot issue direct orders to state officials.
Powers Both Levels Share
Some powers belong to both levels at once. These concurrent powers include taxing residents, borrowing money, building roads, and operating court systems. The overlap is intentional. Both governments need revenue to function, and both need courts to apply their own laws.
Conflict happens when a federal law and a state law cover the same ground and point in different directions. The Supremacy Clause in Article VI settles those conflicts. The Constitution, federal statutes, and treaties are “the supreme Law of the Land,” and state judges are bound by them regardless of what state law says.5Constitution Annotated. Article VI Clause 2
When Federal Law Displaces State Law
The Supremacy Clause also anchors a doctrine called preemption, which determines when federal law displaces state law altogether. Congress can preempt expressly by writing language into a statute that says so. Federal law can also preempt implicitly when the federal regulatory scheme is so thorough that no room is left for state rules, or when complying with both the state and federal law at once would be impossible.6Congress.gov. Federal Preemption A Legal Primer
Preemption fights come up constantly in drug regulation, workplace safety, and immigration. A state may pass a law that seems sensible on its own only to see it struck down because federal regulators already occupy the field. Courts do start with a presumption against preemption in areas states have traditionally regulated, so displacement is not automatic.
The Commerce Clause and Federal Reach
The single biggest reason the federal government regulates so much more today than it did in 1789 is the Commerce Clause. Article I, Section 8 gives Congress power to regulate commerce “among the several States.”7Constitution Annotated. Overview of Commerce Clause What counts as interstate commerce has expanded dramatically since the founding. Through a series of twentieth-century Supreme Court decisions, Congress gained authority to regulate activities that substantially affect interstate commerce, even when those activities take place entirely within one state.
The Commerce Clause supports federal laws on civil rights protections in private businesses, environmental standards, labor rules, and much more. It remains the constitutional basis for most federal regulatory authority, and disputes over its edges continue to shape the line between federal and state power.
How Federal Money Shapes State Policy
Congress cannot order states to adopt a particular policy, but it can make funding contingent on compliance. This spending power, rooted in Article I, Section 8, gives Washington real leverage. Congress has “wide latitude to attach conditions to the receipt of federal assistance in order to further its policy objectives.”8Congress.gov. Funding Conditions Constitutional Limits on Congress Spending Power
In the 1980s, Congress wanted states to raise the minimum drinking age to 21 but could not mandate it directly. It withheld a percentage of federal highway funds from any state that refused. The Supreme Court upheld this approach in South Dakota v. Dole (1987), reasoning that the condition was related to a legitimate federal interest and was not unduly coercive.8Congress.gov. Funding Conditions Constitutional Limits on Congress Spending Power
There are limits. Funding conditions must be clear, related to the program in question, and cannot cross the line from incentive into compulsion. The condition also cannot require the state to violate an independent constitutional right. Conditional grants remain one of the most powerful tools Congress uses to shape state law without technically commanding anything.
What Neither Level May Do
The Constitution also takes specific actions off the table for both levels of government.
Article I, Section 9 restricts Congress. The federal government cannot pass a bill of attainder, which punishes a specific person or group without a trial, or an ex post facto law, which criminalizes conduct after the fact. Congress also cannot suspend the writ of habeas corpus except during a rebellion or invasion.9Constitution Annotated. Article I Section 9 – Powers Denied Congress
Article I, Section 10 restricts the states. No state can enter into a treaty, coin its own money, or grant letters of marque. States face the same ban on bills of attainder and ex post facto laws, and they cannot pass any law impairing existing contractual obligations.10Constitution Annotated. Article I Section 10 These restrictions keep states from acting like independent nations and protect individual rights from abuse at either level.
State Sovereign Immunity
The Eleventh Amendment adds another layer of protection for states. It bars federal courts from hearing lawsuits brought against a state by citizens of another state or by foreign nationals. The Supreme Court reads it more broadly still, holding that states are generally immune from being sued without their consent, including by their own citizens in federal court.11Constitution Annotated. General Scope of State Sovereign Immunity Congress cannot override this immunity using its Article I powers, though it can do so under Section 5 of the Fourteenth Amendment when enforcing civil rights protections.
How States Must Treat Each Other
Federalism would fall apart if states could ignore each other’s legal systems. Several constitutional provisions keep the states working as parts of a single nation.
The Full Faith and Credit Clause (Article IV, Section 1) requires every state to honor the official acts, public records, and court judgments of every other state.12Constitution Annotated. Overview of Full Faith and Credit Clause Win a money judgment in one state and the losing party moves to another, and the new state’s courts must enforce that judgment. The same principle applies to records such as marriages and professional licenses.
The Privileges and Immunities Clause (Article IV, Section 2) prevents states from discriminating against residents of other states. A state cannot reserve rights like property ownership or the practice of a profession exclusively for its own residents while shutting out citizens from elsewhere.13Constitution Annotated. Overview of Privileges and Immunities Clause
The Extradition Clause (Article IV, Section 2, Clause 2) covers fugitives. A person charged with a crime who flees to another state must be returned to the state where the crime was committed when that state’s governor demands it.14Constitution Annotated. Article IV Section 2 Clause 2
How the Balance Has Shifted
The framework has stayed put, but the actual balance of power has moved continuously since 1789. In the early republic, a model sometimes called dual federalism kept federal and state responsibilities in relatively separate lanes. That started to change during the New Deal era of the 1930s, when the federal government expanded into labor law, agriculture, and social insurance. By the 1960s and 1970s, federal involvement had reached further into environmental protection, education, and civil rights.
The modern arrangement looks more like cooperative federalism, where national and state agencies share responsibility for running programs. Medicaid is a joint federal-state endeavor with shared funding and overlapping rules. Highway construction, environmental enforcement, and education standards follow similar patterns. The federal government sets broad policy and provides money; states handle day-to-day administration and keep some flexibility in how they comply.
Swings in the other direction happen too. Courts periodically enforce limits on federal power, as the anti-commandeering decisions show. The system does not stay still.
Where Local Governments Fit
The Constitution says nothing about cities, counties, or any other form of local government. Local governments exist only because states create them and grant them authority, which puts them on a fundamentally different footing from states, whose power comes directly from the Constitution.
The scope of local authority depends on how a state treats its municipalities. Under Dillon’s Rule, local governments hold only those powers their state has expressly given them, and courts read any ambiguity against local authority. Many states have moved toward a home rule model, which grants cities and counties broader power to govern their own affairs without needing specific legislative permission for every action.
Despite their subordinate legal status, local governments handle the functions most people interact with daily: police and fire protection, water and sewer service, zoning, road maintenance, and public health programs. They also serve as the front line for carrying out state and federal programs in the community. Most of the government services you rely on come from the level of government the Constitution never mentions.