Free-Market Federalism

“States and municipalities craft laws that reflect local cultures, and this proximity to the people has market consequences,” says James Bruce in this week’s Acton Commentary. “Let’s call it free-market federalism, the encouragement of local markets by permitting states and municipalities to frame, as much as possible, the laws by which the communities engage in commerce.”

In a spirited defense of decentralization, Abraham Kuyper argues that a central government can only supplement local governments and families. Put another way, the central government exists because local governments and families already do. It exists for them. They do not exist for it. So Kuyper’s idea of sphere sovereignty supports free-market federalism. Regional governments and municipalities exist as their own sovereign spheres, and they must continue to do so. “To centralize all power in the one central government is to violate the ordinances that God has given for nations and families,” Kuyper wrote. “It destroys the natural divisions that give a nation vitality, and thus destroys the energy of the individual life-spheres and of the individual persons.” This vitality extends to national, regional, and individual economic life.

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