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Sectionalism now has engulfed economic as well as culture-war issues: labor policy, health care, health insurance, global warming, energy policy, immigration.
Congress considered but rejected a program like that; the administration ran an embryonic (and failed) program with some money it found under a rock; the settlement is the real deal.
And it’s federalism: the fund allocation is by state, and the program is run by an ad hoc committee headed by a former banking commissioner and composed of federal and state officials.
Over time the federal government’s ambitions have become more local: land use, education curricula and services, etc.
At first impression that looks like an expansion of Congress’s power—but it really isn’t.
Medicaid, education, welfare, and other programs work that way .
Executive federalism is highly asymmetric: federal program requirements are worked out or waived for individual states, and the differences are huge. There are fifty different Medicaid programs, and they have only one thing in common: not one of them has anything to do with the statute. Executive federalism works through dealmaking, not rulemaking.
For one thing these programs have to be implemented by local agents, who have a million ways to shirk. In the federalism dimension it plays out as sectionalism—divisions between cohesive blocs of states, over salient and recurrent issues, that can’t be overcome through compromise (for example, by bribing states into a minimum winning coalition).
If you want to keep them in line and try to make the programs work you need a branch that’s in business 24/7—the executive. Congress cannot really handle sectional politics, which explains why national policy on abortion or gay rights has to come from the Supreme Court.
Medicaid’s operation is governed through MOUs (Memoranda of Understanding)—without notice and comment, without anyone at the table except the state bureaucrats and people from HHS and CMS, and without any opportunity for arbitrary and capricious review.
Over the past decade multi-billion dollar settlements with corporations that are accused of wrongdoing have proliferated.