13 INSTITUTIONAL VETO PLAYERS

Learning Objectives

  • Define key concepts: federalism, bicameralism, constitutionalism.

  • Compare: different types of federalism, bicameralism, constitutionalism.

  • Assess: advantages and disadvantages of federalism, bicameralism, constitutionalism.

  • Describe and interpret: veto player theory and its implications.

Introduction to Institutional Dimensions

  • Democracies vary based on government type, electoral systems, and party systems.

  • Focus of this chapter: federalism, bicameralism, and constitutionalism as forms of checks and balances on the political system.

  • Conceptualized as "institutional veto players" influencing the change of political status quo.

Federalism

Definition and Structure

  • Countries classified as either federal or unitary.

  • Federalism in structure vs. federalism in practice (decentralization).

Criteria for Federalism:

  1. Geopolitical division: Mutually exclusive regional governments constitutionally recognized.

  2. Independence: Regional and national governments must have independent authority, typically elected independently.

  3. Direct governance: Authority shared between regional and national governments, citizens governed by two authorities.

Countries with Federal Structures

  • About 10% of countries were federal in 2023, including:

    • Argentina, Australia, Belgium, Brazil, Canada, Germany, United States, Venezuela, etc.

  • Federal countries often large or diverse.

Case Study: Brazil

  • Brazil's federalism dates back to the 1891 constitution; current structure from 1988 constitution.

  • Three levels of governance: federal, state, and municipal.

    • Federal Level: Executive power with President.

    • State Level: 26 states and a federal district, governed by governors.

    • Municipal Level: 5,570 municipalities, governed by mayors.

  • Legislation allowed in areas not explicitly prohibited by constitution (Articles 1, 25, 30).

Types of Federalism

Congruent vs. Incongruent Federalism

  • Congruent federalism: Territorial units have similar demographic compositions (e.g., United States, Brazil).

  • Incongruent federalism (ethnofederalism): Different demographic makeups among territorial units; reflects concentrated social groups (e.g., Switzerland, Belgium).

Symmetric vs. Asymmetric Federalism

  • Symmetric federalism: Territorial units hold equal powers (e.g., United States).

  • Asymmetric federalism: Some units enjoy more power due to cultural or ethnic considerations (e.g., Canada and its province of Quebec).

Devolution vs. Federalism

  • Devolution occurs when central governments transfer power to regional governments without constitutional protection (e.g., India, Spain, UK).

  • Regional governments can be reshaped or abolished by the national government.

Example of Devolution: India

  • India has national and state governments, but the central government retains significant power.

  • Articles 3 and 356 allow central government to alter state boundaries and impose rule.

Federalism in Practice

  • Importance of distinguishing between federalism in structure and its practical application (decentralization).

  • Fiscal centralization as a key measure of state centralization: percentage of tax revenue collected by the central government.

  • Federal states tend to collect less tax revenue centrally compared to unitary states.

Revenue Centralization Data

  • Federal systems averaged 57.28% in revenue centralization vs. unitary systems at 75.58%.

Why Federalism?

Types of Federalism Adoption

  1. Coming-together federalism: Bottom-up agreement of pre-existing sovereign units to pool resources for collective benefits (e.g., USA, Switzerland).

  2. Holding-together federalism: Central government decentralizes power to keep historically oppressed groups content (e.g., Belgium, India).

Advantages of Federalism

  • Improved citizen preference satisfaction through localized governance.

  • Closer government-citizen interactions increase accountability and responsiveness.

  • Competitiveness among regions encourages efficient government performance and policy innovation.

  • Federalism viewed as a hedge against tyranny, allowing intergovernmental checks.

Criticisms of Federalism

  • Complex layers can lead to overregulation, duplication, and inefficiency.

  • Critics argue it exacerbates collective action challenges, particularly in economic management.

  • Increased competition can result in downward harmonization, affecting redistributive tax systems.

  • Blame-shifting and accountability issues arise; citizens struggle to pinpoint responsibility for policy failures.

Conclusion

  • Federalism offers a fundamental constitutional arrangement but proves complex in practice.

  • It presents a continuum of decentralization with varying impacts on governance efficiency, accountability, and economic performance.