2.1. What is federalism?

Federalism is a system of government in which the power is divided between a central authority and various constituent units of the country. Usually, a federation has two levels of government. One is the government for the entire country that is usually responsible for a few subjects of common national interest. The others are governments at the level of provinces or states that look after much of the day-to-day administering of their state. Both these levels of governments enjoy their power independent of the other.

Federalism refers to a governance system where the central power (national government) shares authority with lower levels (state or provincial governments). The key idea is that each level of government has its own responsibilities and powers that are separate and not overruled by other levels. For example, the federal government might handle national defense, while state governments might manage education and local law enforcement.

Think of a school where there is a principal (the central government) who sets broad policies and rules for the whole school, but each class also has its own teacher (the state governments) who decides how to implement those rules in their classroom. The principal can't change how the teacher runs the class directly, just like the central government can't order the state governments to act in specific ways.

The federal system thus has dual objectives: to safeguard and promote unity of the country, while at the same time accommodate regional diversity. Therefore, two aspects are crucial for the institutions and practice of federalism. Governments at different levels should agree to some rules of power-sharing. They should also trust that each would abide by its part of the agreement.

Federalism aims to balance unity and diversity. It's designed to hold the country together while recognizing different regional needs. For successful federalism, there must be clear agreements on how powers are shared. Each government level must trust the others to follow the agreed rules, creating a collaborative environment where everyone fulfills their responsibilities without overstepping.

Imagine a sports team where each player has a defined role. The team functions best when everyone understands and respects their positions—like a forward who scores goals and a defender who prevents the opponent from scoring. If one player tries to take over another player's role, the team won't function effectively.

There are two kinds of routes through which federations have been formed. The first route involves independent States coming together on their own to form a bigger unit, so that by pooling sovereignty and retaining identity, they can increase their security. This type of ‘coming together’ federations include the USA, Switzerland and Australia. The second route is where a large country decides to divide its power between the constituent States and the national government. India, Spain and Belgium are examples of this kind of ‘holding together’ federations.

Federations can form in two main ways: 'coming together' and 'holding together.' In 'coming together' federations, independent states unite to form a single country for mutual benefits. For instance, the USA evolved from independent states. In contrast, 'holding together' federations emerge when a large nation divides its powers among various states, aiming to manage diversity, like in India, where the central government is often more powerful than individual states.

You can think of 'coming together' like friends from different schools forming a club to enjoy shared interests. They agree to rules together. On the other hand, 'holding together' is like a large family where parents (the central government) make most decisions but allow older kids (the states) to manage their own chores and activities.

In a federal system, the central government cannot order the state government to do something. State government has powers of its own for which it is not answerable to the central government. Both these governments are separately answerable to the people.

The key distinction between federal and unitary systems lies in the power dynamics. In a federal system, states have their own powers and can't be directed by the central authority. Both levels are accountable to their own citizens. In contrast, a unitary system concentrates power at the national level, where the central government can dictate actions for local governments.

Think of a federal system as a band where every member plays their own instrument and contributes individually, while a unitary system is like a solo musician who plays all parts. In the band, each musician (state) has individual creative control, while in a solo act, the musician (central government) manages everything directly.

Let us look at some of the key features of federalism: 1. There are two or more levels (or tiers) of government. 2. Different tiers of government govern the same citizens, but each tier has its own jurisdiction in specific matters of legislation, taxation and administration. 3. The jurisdictions of the respective levels or tiers of government are specified in the constitution.

Key features of federalism include having multiple government levels fueling cooperation and local governance. Each level has its unique authority to legislate, tax, and manage administration separately. The constitution outlines these powers to prevent overlap and conflicts, enabling each level to operate effectively.

Imagine a city with different departments: the fire department, police department, and school board. Each has its own rules and responsibilities, like taxation and legislation for their specific areas. They work together for the city’s overall function, but they don't interfere in each other's daily operations.

Sources of revenue for each level of government are clearly specified to ensure its financial autonomy.

For a federal system to function efficiently, it's crucial that each level of government has defined sources of revenue. This financial autonomy allows them to govern without needing direct approval or financial support from other levels. It ensures that governments can operate independently, fulfilling their assigned roles.

Think of a family where each sibling has their own allowance. They can decide how to spend it, independent of each other's finances. Each child can manage their responsibilities and make their own choices with their money, much like governments making decisions based on their revenue.

--