President’s Page: Best Practice

n ITS work around the world ,
the Forum of Federations is frequently
asked about “best
practice” on this or that aspect of
federalism. It is a perfectly reasonable
question to put to us, given our network
and expertise, but it is also a tough one.
Answering it can entail two very different
The first risk is of a kind of agnostic relativism
to the effect that it is “hard to say
what is best” because context is so fundament
a l l y impor t ant that no
arrangements are truly transferable.
Each federal society must work out its
own problems by finding solutions that
fit its unique circumstances. Taken to its
extreme, this view virtually amounts to
saying we cannot learn from one another
about political arrangements.
The second, opposite risk is of an
abstract approach that treats all questions
about “best practice” as amenable
to rather technical, universal answers.
This can be seen, for example, in some
economists’ writings on prescriptive criteria
for allocating legislative and
revenue raising responsibilities between
central and constituent unit governments,
and in some political scientists’
writings on the merits of parliamentary
versus congressional systems or on
upper houses in federations.
While context is important and every
society is unique in important ways,
clearly lessons can be learned from others
whose societies share certain
characteristics and similar problems.
And while abstract reasoning about federalism
cannot produce universal,
technical answers to most of the key
problems federal societies confront,
such reasoning does have a contribution
to make.
At the most general level, our knowledge
of federalism offers us a good sense
of the societies where it is most likely to
be appropriate and successful. These are
countries with very large populations or
territories or with regionally diverse
populations, that have a sense of a
national identity as well as of regional
identities, and, fundamentally, that have
developed a spirit of mutual accommodation.
But these latter characteristics of
identity and accommodation can change
over time and should not simply be
treated as static and given.
Institutionally, evidence shows that
federations with a very small number of
constituent units are hard to manage.
But it is less clear what are the universal
merits of parliamentary versus presidential-
congressional institutions (would
the US A really be better with a parliamentary
regime?) or what is the “best”
model for upper houses (would the
German model really suit India?).
Highly diverse federations need policies
for dealing with several languages.
While language can be deeply divisive,
many federations have reached consensus
and “settled” the issue. But it is
striking how different their approaches
are: fairly strict territorially-based language
rights in some cases; more diffuse,
individually based rights in others. It is
not obvious which is “best”.
On fiscal federalism, we know much
about techniques to limit destructive tax
competition and leakage, to promote tax
harmonization and efficient collection,
and to equalize fiscal capacity across a
federation. But appropriate techniques—
and even objectives—in a particular
federation may depend heavily on its
sense of shared community, equity and
the division of sovereignty.
While such questions rarely reveal a
single “best practice”, there is still much
to learn from successful and unsuccessful
experiences, and from more general
reasoning about institutions, economics
and political philosophy. This does not
always make for quick and easy answers,
but the scarcity of universal “best practices”
should not detract from