States on
divergent fiscal paths can test the flexibility of an empire-scale union,
particularly if it is relatively new and still developing. Simply having
different industrial/agricultural make-ups can put states at odds with each
other. That the richer states can use fiscal policy to become even richer,
while the policies imposed on poorer states may aggravate their fiscal conditions,
can mean that the economic distinctions between states can become an increasing problem in a federal system,
even given the allowances enabled by federalism itself (e.g., by the principle
of subsidiarity).
The
complete essay is at Essays on Two Federal Empires, available at Amazon.