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Comparative Federalism of Single Markets in the US and the EU

Thu, September 5, 8:00 to 9:30am, Marriott Philadelphia Downtown, 403

Session Submission Type: Full Paper Panel

Session Description

Much of the authority of the U.S. federal government and the EU today derives from projects for internal openness—or “single markets”—at the core of both polities. Historians typically rank the restraint of internal protectionism as the leading motivation for drafting the U.S. Constitution, as codified in the Commerce Clause that assigned authority for interstate commerce to Congress. Over time, this clause became the vehicle for major expansions of federal power. Almost two centuries later, and in explicit imitation of the vast American market, the European institutions were founded around commitments to the “four freedoms” for goods, services, persons and capital across member-states. This mandate served as the leading justification for a steady increase in EU powers over time.
Within these parallel dynamics, the world’s two big advanced-economy single markets arrived at quite different principles to govern internal openness. The contrast stands out in a May 2023 decision from the U.S. Supreme Court. It upheld California’s animal-welfare rules on pork production against a challenge from pork farmers in other states (mainly Iowa). The Iowans failed to persuade either the most liberal or the most conservative justices that California, which produces almost no pork, lacks the authority to regulate interstate commerce in this way. Had they been in the EU, however, there is no doubt they would have prevailed. Under its single market rules, the strong animal-welfare laws in Austria (for example) only apply to Austrian producers. Austria, unlike California, generally cannot create rules that exclude other member-states’ goods.
Far from reflecting specific differences around animal rights or food regulation, this example captures basic and highly consequential differences at the core of these two federal-style arenas. Even if Europe’s single market project originally took the U.S. as its inspiration, its legal requirements for open interstate commerce are now considerably stronger than those in the U.S. Its tougher legal principles for internal openness are also enacted in far broader, more systematic and elaborate legislation and enforcement than exists across the Pond. Today, it is unambiguous that California and Texas retain more authority over flows of goods, services, persons and capital across their borders than France or Germany do. Stepping back, we can see that the U.S. has never pursued anything much like the EU’s conscious internal-openness project, and continues to show strong deference to “states’ rights” on a wide range of regulatory issues.
These observations are the point of departure for the ongoing SINGLEMARKETS research project, directed by Craig Parsons at the University of Oregon/University of Oslo. It compares the politics of single markets in the EU and the U.S., asking: Who cares about interstate openness in the U.S. and the EU today? How and why do American and European citizens, businesspeople and public officials evaluate and mobilize around the many trade-offs generated by openness (or impediments thereto) across their diverse arenas? The project includes roughly 50 interviews with EU and U.S. federal officials, over 300 interviews with businesspeople and public officials in three sectoral studies, and a first-of-its-kind survey fielded in June 2023 with representative samples of 4,000 Americans and 22,000 Europeans in 11 countries.
Our panel presents five early products of this four-year effort, which will conclude in 2025. Our discussant, R. Daniel Kelemen, is a noted expert on comparative federalism and the EU who is not involved in the project.

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