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Structuring the State

Princeton University Press

Chapter One

The concurrence of the German and Italian revolutions will one day represent one of the most fruitful of parallels for the philosophy of history. -HEINRICH TREITSCHKE

FOR OVER THE PAST 130 years, Heinrich Treitschke's invitation to scholars to compare the German and Italian national revolutions has gone largely unanswered. Despite the turbulent parallels between nineteenth- and twentieth-century German and Italian political development, the two cases remain an underutilized comparison for the study of state formation, nationalism, and federalism. This study takes up Treitschke's appeal to compare the two great episodes of nineteenth-century European nation-state formation in order to address a puzzle: how are nation-states made, and what determines whether nation-state formation leads to the creation of federal or unitary patterns of governance?

In an age when the issues of state building and federalism have returned to the center stage of politics in discussions of the European Union and nation building more broadly, a comparative analysis of nineteenth-century European nation-stateformation offers a fruitful way to investigate questions that are once again concerns for scholars and policymakers: What are the conditions under which a new political entity is created? What determines the institutional form of that entity? What are the conditions under which federalism can be created? In moments of institutional founding, how much impact do political leaders actually have in designing political institutions? Can political leaders who seek federalism simply adopt a constitution that guarantees federalism? Can a federal constitution be violently imposed? Or must it emerge "bottom up" from a collection of symmetrically powerful subunits negotiating themselves into existence?

This study focuses on Europe during the nineteenth century because it is a period that casts new light on these issues. Though the rise of nationalism is normally attributed to the French Revolution, it was in fact during a decisive period between 1830 and 1880 in Europe, North America, and South America that many contemporary nation-states were created through the dual processes of imperial disintegration and national integration. Left standing in Europe were the new modern creations of Greece, Belgium, Italy, Germany, Bulgaria, and Romania. This period that I call the "national moment" transformed the political map of Europe, North America, and South America. The political systems that emerged out of this set of nearly simultaneous experiences of nation-state formation were marked by a wide array of institutional forms that provide a diverse set of empirical cases for contemporary scholars of political development.

In particular, in one area of nation-state structure-the institutionalized territorial distribution of power between national and subnational governments-the new nation-states of the late nineteenth century displayed an institutional diversity that raises the question of how nation-states are formed and how the relationship between national and subnational governments comes to be established. While some newly formed polities such as Germany and Canada became explicitly federal political systems, others such as Italy and Belgium became classically unitary systems. In federal systems, like Germany and Canada, regional states were absorbed but remained intact as constitutionally sovereign parts in the larger "national" political framework: regional governments had formal access to the national government, discretion over public finance (i.e., taxing and spending), and administrative autonomy. By contrast, in states such as Italy and Belgium, any existing regional governments were erased from the map as sovereign entities and left without formal access to the new national governments, without public finance discretion, and without formal administrative autonomy. While experiencing a similar timing in their formation, the new nation-states of the nineteenth century experienced divergent institutional political arrangements of territorial governance after national unification. That both federal and unitary systems were the products of these institution-building experiments raises a deeper theoretical paradox of federalism's origins that is the central question of this book: How can a state-building political core that seeks to integrate its neighbors be strong enough to form a larger nation-state, but also not be too strong to entirely absorb and erase existing units, thereby creating a unitary nation-state? If the core is too unyielding, will not a unitary system result? If too accommodating, will not a union be impossible to forge in the first place?

In brief, I argue that to explain why federal and unitary nation-states form, we must answer two analytically separate questions: why do nation-states form? Why do nation-states take on unitary or federal structures? The first part of this study answers the first question. The second answers the second question to argue that once a process of national unification is under way, the way out of the paradox of federalism's origins for political leaders with federal aspirations is for the political core to absorb states with high levels of what I call "infrastructural capacity"-the ability to tax, maintain order, regulate society, and generally govern their societies. If a political core absorbs these types of states, then the potentially contentious relationship of a political core and its subunits that makes federations so difficult to construct can be overcome. With highly infrastructural states in place, a process of primarily negotiated nation-state formation is possible in which authority is conceded to the subunits. Why? Only subunits with high levels of infrastructural capacity can deliver the gains to the core and the subunits that were sought with the project of national unification the first place. If, by contrast, a political core-whether militarily strong or weak-begins the process of absorbing states that do not have this infrastructural capacity, then a more difficult relationship between core and subunits emerges. Since absorbed states are perceived as not able to deliver the benefits of national unification, they are viewed simply as an impediment to unification. This makes negotiation less likely, resulting in a path of nation-state formation through conquest, and the creation of a unitary political system. In order to explain whether nation-state makers adopt federal or unitary structures of governance, a central ironic lesson of this book emerges: If state makers seek federalism but absorb infrastructurally underdeveloped states, they may find themselves constrained by the domestic governance structures of the very states they incorporate in the project of national unification.

FEDERALISM'S ORIGINS, INSTITUTION BUILDING, AND EUROPEAN NATION-STATE FORMATION

The study of federalism's origins is particularly important for at least two reasons. First, in recent years, federalism has been increasingly viewed as an institutional solution to a broad range of problems. Some scholars such as Barry Weingast have highlighted the positive impact of federalism on the creation and sustaining of free markets. Others, such as Jonathan Rodden and Erik Wibbels, have pointed to the potential benefits and pitfalls of federalism for fiscal performance, the growth of government, and economic performance more broadly. Still others, such as Michael Hechter and Nancy Bermeo, have argued that federal structures, when contrasted with unitary patterns of governance, have a broad set of beneficial effects for accommodating minorities, reducing ethnic conflict, and holding nation-states together. Not only scholars but also policymakers, international institutions, and political leaders increasingly view federalism as a potential solution to a diverse range of problems. Though we know a great deal about federalism's consequences, our understanding of federalism's causes remains relatively underdeveloped. If federalism is such a critical potential institutional device, what are the conditions under which, and processes by which, nation-state makers can actually adopt this institutional form? A literature has begun to develop that explores the sustainability of federal political systems. But less attention has focused on the origins of federalism. Can a federal constitution be imposed in any institutional, cultural, socioeconomic context? Or must federalism be negotiated from within? What are the pathways by which political leaders can move their polity in the direction of federalism? How, in the process of nation-state formation, does the bundle of federal institutions rather than unitary institutions emerge?

Second, the study of state formation and federalism's origins contributes to our understanding of the political development of Europe itself. Though scholars of European political development have long noted the presence of national institutional diversity across the continent of Europe, little comparative attention has been paid to the important and persistent divide among federal and unitary nation-states in the development of Europe. To explain the origins and persistence of other macro institutional differences, there has developed a wide-ranging scholarship in the tradition of Alexander Gerschenkron and Barrington Moore that identifies how diverse pathways of nation-state formation have given rise to outcomes such as the nature of national patterns of absolutism, regime type, the national organization of capitalism, and the choice of electoral institutions. One area that has oddly remained out of the focus of scholars' attention is the "federal-unitary divide"-the presence of four federal states and thirteen unitary states among the seventeen largest states of contemporary Europe. By first examining two key cases of nineteenth-century Germany and Italy and then in the last chapter placing these cases in the broader context of the seventeen largest cases of western Europe, this study explores the source of this diversity in the structure of European nation-states, generating insights that potentially travel well beyond Europe's borders.

CONCEPTS, RESEARCH QUESTIONS, AND EXPECTATIONS OF EXISTING THEORY

Before undertaking an explanation of nation-state formation and federalism, I need to provide some definitions. By nation-state, I refer to the specific set of sovereign territorial units that emerged in Europe, North America, and South America after the French Revolution, that were modeled on the French and British national experiences, and that were neither absolutist states nor multinational imperial orders. They were instead novel "national" amalgams of civic, ethnic, and state modes of organization and identification. The definition of federalism is more contested. Some scholars define federalism in cultural or ideological terms. Others have expanded the definition to incorporate as necessary components such concepts as "democracy" or even "political stability." I find it more useful, when engaging in empirically based social scientific analysis, to define "federal" nation-states as those with subnational sovereign governments that possess three constitutionally embedded institutional characteristics that tend to cluster together: (1) formal and informal access of subnational governments in the decision-making process of national governments, (2) subnational public finance (taxing and spending) discretion, and (3) administrative autonomy of regional governments within a nation-state. My definition of federalism describes the relationship between a central government and its regional governments in strictly dichotomous terms: Even if subnational governments exist, only nation-states with constitutionally protected subunits qualify as federal. If only one level of government exists or subunits are not constitutionally protected, the entity is a unitary nation-state.

The central research questions of this study are these: Under what conditions does a state-making core incorporate but leave existing subunits intact, creating a federal nation-state? Under what conditions does a state-making political core incorporate but dissolve the authority of regional governments to take on more unitary characteristics? Why, in some instances, can federalism be successfully constructed? Why, in other instances, does federalism fail to take root? Political science and historical scholarship on these questions has been dominated by accounts that focus on one of three main variables: ideas, culture, or power. Table 1.1 presents a schematic overview of each approach.

Each of the main approaches to the study of federalism offers prima facie convincing explanations of why a nation-state might adopt a "federal" pattern of center-periphery relations. The first approach, usually associated with scholars such as Michael Burgess, argues that the ideas of political leaders and constitutional designers as well as society at large are decisive in shaping the structure of political institutions in a nation-state. The second perspective takes history and culture seriously, focusing on the nature of cultural or ethnic divisions within a society. Though this second perspective usually emphasizes "primordial" differences in ethnicity, the argument can be extended to deep-seated cultural differences between regions or high levels of regional loyalty-even without "ethnic" roots-to argue that federal institutions will emerge in a polity with a regionally fragmented population with deep-seated regional loyalties. Finally, the third perspective, most closely associated with William Riker and, more recently, with a set of works that have formalized the logic of Riker's argument, argue that federalism emerges and can sustain itself only as a delicate "bargain" between an equally powerful "center" and "periphery," in which neither the center is strong enough "to overawe" the regions, nor the regions powerful enough to "undermine" national integration.

OVERVIEW OF CASES: THE PUZZLE OF FEDERALISM'S FAILURE IN ITALY AND ITS SUCCESS IN GERMANY

This study takes advantage of what is almost a natural experiment in the development of political institutions in nineteenth-century Europe to test these three hypotheses of nation-state formation and the causes of federalism. In the 1850s and 1860s, two states-Piedmont in Italy and Prussia in Germany-undertook the national unification of the Italian and German states under similar ideological, cultural, and power-structural conditions that ought to have led to similar institutional outcomes. After the failed democratic national revolutions of 1848 in Italy and Germany, the pragmatic political leadership of two militarily powerful states (Piedmont and Prussia) adopted the agenda of nationalism to expand each state's zone of political control in Europe. The similarities between the two cases are striking: First, as this work will make clear, the chief architects of national unification in Italy and Germany in the 1860s-Cavour and Bismarck-undertook their political projects with a similar ideological awareness of the dangers of excessive centralization, and in both cases there was a similar ideological commitment among key intellectual and political leaders to the notion of "federalism" as a solution to the history of regional divisions in both contexts, given international misgivings over the potential of creating two powerful and centralized states in the middle of Europe. Second, the deep-seated cultural-historical regional forces for and against national unification-rooted in regionally uneven economic gradients in both sets of territories-were similar. Third, in both cases two politically powerful regions sought to secure a position of dominance in the new nation-state after unification. In both cases, the goal of unification was the same: to assure geopolitical significance for the state while maintaining monarchical control.

Yet, despite these three similarities, the two late-developers of western Europe adopted very different patterns of territorial governance for each new nation-state. In Germany after 1866, the Prussian leadership, despite support in key sectors of the military for the conquest of southern Germany, combined their direct annexation of states of Germany's center and north with a path of negotiated unification to create a system of federal territorial governance that formally institutionalized the other states as "regions" in the new political entity. The new political construction had three distinct dimensions: (1) a territorial chamber was constituted by representatives chosen by the regional monarchs of the formerly independent constituent states; (2) these member states retained a relatively high level of autonomy in public finance (taxing and spending) that also represented a high degree of policy autonomy; and (3) each of the member states retained control over its own independent administrative apparatus.

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Excerpted from Structuring the State by Daniel Ziblatt Copyright © 2006 by Princeton University Press. Excerpted by permission.
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