By David S. D’Amato
When people, libertarians included, think of federalism, chances are good that they do not think of Pierre-Joseph Proudhon. More likely, they think of the The Federalist and its authors, and of the Constitution and its particular federalist structure. Federalism scholar S. Rufus Davis refers to Proudhon’s treatment of federalism, The Principle of Federation, as “a teasing puzzle,” long neglected as a bizarre and unwelcome entry in the story of the federal idea. Published in 1863, shortly before his death, The Principle of Federation arguably represents Proudhon’s mature thought and offers a robust account of federalism deserving of study among students of the idea, particularly libertarians. As we shall discuss here, certain libertarian thinkers, notably Vincent Ostrom, have perceived the importance and relevance of Proudhon’s federalism to a thoroughgoing approach to the idea itself and to a theory of the free society generally.
It is frequently argued that a variety of collective action problems demand a single central decision maker, one uniquely empowered to make final determinations. But centralized, hierarchical organizations are actually ill-equipped to provide effective solutions to collective actions problems, constrained both by their distance from the problems at hand and by the incentive problems associated with monopolies, which are insulated from feedback and competition. Indeed, as both Elinor and Vincent Ostrom’s work demonstrates, successful and efficient collective action requires just the opposite—a polycentric political and social order in which there are several centers of decision-making power, often even overlapping. Here, Proudhon’s federalism remains highly relevant and applicable to contemporary social and policy problems.