In the 21st century, the idea of federalism seems quaint and somewhat naive. Since 1920, the High Court has consistently handed down judgments that grant the federal government plenary power. Any notion of the States having powers that are beyond the Commonwealth’s grasp has been summarily dismissed. Not surprisingly, the noble intention of the founders to put in place a system where the federal government deals only with national matters such as defence, interstate commerce etc. and state governments are responsible for education, health and other local issues, has not been achieved in practice. There is not much left of federalism in the Australian Constitution.
Professor Craven documents the High Court’s centralising agenda in his book Conversations with the Constitution: Not Just a Piece of Paper. Reversing the decline of federalism, according to Craven, involves three steps. First, the states must have the ability to initiate referenda. The Commonwealth’s monopoly over the initiation of referendums has led to a series of pro-federal government proposals. Allowing states to put forward their ideas would present Australians a more balanced range of choices. Next, the federal government ought to obtain the agreement of at least three states before making a High Court appointment. Craven objects that the current system is biased:
By providing that the commonwealth executive should appoint the justices, the founders ensured that the umpires of the national game of constitutional football would be chosen by the captain of one of the competing teams, and would display a corresponding degree of neutrality (p.79).
Greater state input makes it more likely that judges in favour of restraining the federal government will be appointed.
Finally, the Senate should be transformed into a genuine ‘states house’. Senators should be selected by their respective state parliaments rather than being directly elected. Senators would then represent the party interests of Victoria, Tasmania, etc. but not the interests of the federal parliamentary parties.
If these changes were implemented, there would undoubtedly be a re-working of the relationship between the Commonwealth and the States. However, most of Craven’s proposals require amendment of the Constitution via section 128, an exceedingly difficult process. Are there more practical means of restraining the federal government? Indeed there are. Missing from Craven’s analysis are two concepts related to federalism that could prove useful in restoring the Federal-State balance: namely, secession and nullification.
Secession is self-explanatory: it is the severing of ties from a larger political entity. In their Virginia and Kentucky Resolutions, Thomas Jefferson and James Madison (perhaps unintentionally) laid the groundwork for a theory of federalism that allows for genuine participation by the States in interpreting the Constitution. They posed a simple question: can one be in favour of states’ rights while at the same time denying them the means to enforce those rights? The answer, according to the two statesmen, is ‘no’. If states are to realistically enforce their constitutional rights, they will need to be able to wield the threat of secession when the federal government oversteps its bounds. Although Craven comes down in favour of federalism, he has elsewhere written against secession, apparently not seeing any inconsistency in supporting one but opposing the other! The NSW Legislative Council once advocated a right of secession, but Craven denounces its view as ‘wanton destruction’ as compared to the ‘constructive criticism’ of those states who accepted Commonwealth supremacy.
The theory of nullification, unlike secession, does not involve the complete severance of all bonds tying a state to the central government. Rather, nullification is deployed on a case-by-case basis to render void specific federal laws that affect a particular state. It is based on the principle that the highest federal court, itself an organ of the central government, should not wield a monopoly on constitutional interpretation. Constitutional interpretation is the inherent right of the people of each state – acting through their representatives – and cannot be the exclusive domain of the High Court. Examples of nullification are rampant in America, and include the widespread defiance of federal anti-marijuana laws by socially liberal states such as California.
The advantage of secession and nullification from a practical point of view is that they require majority support only in the state affected by federal oppression. Unlike constitutional amendment through section 128, which calls for a majority of Australian states as well as a majority of the Australian people, secession and nullification can be implemented peacefully through plebiscite or by a vote of the State parliament. Were these ideas to take root among the Australian public, they would be an effective means of limiting the federal government’s hegemony.
But if constitutional amendment is desired, then another idea, confederalism, would place the states in a powerful position vis-à-vis the federal government. Confederalism is a bulwark of states’ rights since the central government is dependent upon the states for its continued existence.1 The thirteen American states which united under the Articles of Confederation during the 1700s typified such a relationship between centre and states. This union then dissolved and re-formed under the US Constitution because of alleged difficulties in achieving national objectives under the Article’s finance arrangements. However, an excellent study by Russell Sobel shows that no such problem existed, and that the confederal model works just as well in this respect as federalism.2
Federalism, confederalism, secession and nullification are inextricably linked. Any discussion about how to reform federalism would benefit from consideration of all of its dimensions, and this Craven’s work fails to do. The notion of an Australian state seceding, or nullifying laws it declares unconstitutional, is not unusual once one considers that Australia – in effect – carried out a peaceful secession from the British Empire when it became an independent nation. Secession also became a major issue in the 1930s when Western Australians by a two-thirds majority indicated that they wanted to leave the Commonwealth. Unfortunately, the Australian Government refused to honour the popular result and permit WA to secede. So these ideas are not new in Australian history, and have the added advantage of allowing for a potent check upon the federal government.
 A confederal model would live up to the hopeful words of Holder, a South Australian delegate to the constitutional conventions, who said: ‘I do not want that the States should be dependent for their existence on the Commonwealth. If there must be any dependency, there would be less danger in making the Commonwealth dependent on the States’. Convention Debates, Adelaide, 1897, p. 155.
 Russell Sobel, ‘In defence of the Articles of Confederation and the contribution mechanism as a means of government finance: A general comment on the literature’, Public Choice, No. 99, 1999, pp. 347-356.