California, the New Cradle of States' Rights

Texas can eat its heart out. The Golden State is more independent — at least for now.

The semi-republic for which it stands.

Photographer: David Paul Morris/Bloomberg

To people in the rest of the U.S., California can seem like a foreign country. From Donald Trump’s perspective, the feeling may not be purely cultural.

California is pursuing a range of policies designed to thwart the president’s initiatives. Those include blocking offshore drilling that Trump wants to enable; preventing the softening of Obama-era miles-per-gallon standards; and contradicting Trump’s immigration policies with sanctuary laws (a topic I wrote about earlier this week).

Where does California get off acting as if it can resist or set national policy? The answer turns out to be more complicated than you might think. Sometimes, California is exploiting legal loopholes; sometimes it’s relying on special environmental powers conferred on it by Congress; and sometimes it’s deploying the principles of constitutional federalism as developed by the Supreme Court.

The overall picture is of an increasingly independent semi-republic, one uniquely positioned in terms of geography and population to act on its own. Only Texas is even slightly similarly situated — and even during Barack Obama’s presidency, it was not as bold in asserting its differences and prerogatives.

Start with drilling. In January, Trump’s Interior Department announced a draft plan to open much of the offshore continental shelf to oil and gas exploration and extraction. Liberal, environmentally friendly Californians hate the idea. The state’s lieutenant governor, Gavin Newsom, soon declared that “not a single drop” of offshore oil would come ashore in California. 

Now Democratic state legislators have proposed a law that would prohibit new infrastructure projects — including oil and gas pipelines — from being built in state waters. The federal government controls the offshore continental shelf beyond three miles. But states control the first three miles off the coast. The upshot would be to make it legally impossible for energy companies to bring oil or gas ashore in California. They could still transfer what they extract to ships that could travel anywhere. But that is more costly than the pipeline solution. California’s goal is therefore to raise the costs of offshore drilling in order to block it from happening.

As a matter of structuring policy for a single country, this is a modestly outrageous result. I’m not especially sympathetic to offshore drilling, but recall that the Trump administration thinks of it as a national security imperative, not just an economic initiative. National security policy and national economic policy should be set by the federal government, not blocked by state legislators’ intransigence.

Of course, in this case, it’s easy to see the California Legislature as a hero of the environment and the resistance to Trump. Its proposed legislation is probably permissible under existing constitutional law. And if the federal government really needed to change things, Congress could in theory pass a law preempting California’s control over all pipelines traveling into the state from the ocean.

Yet it’s worth noting that, as things stand, California is poised to take advantage of a gap in federal control in order to work against national policy.

The story is different when it comes to miles-per-gallon standards. Here, longstanding federal law gives California the unique authority among states to pass its own emissions-related laws in order to combat smog in places like Los Angeles. Combined with California’s huge share of the national auto sales market, that legal power allows the state to set the floor for things like emissions and gas mileage. Thus, even if Trump dilutes federal standards that were raised during the Obama administration, California could potentially make that action irrelevant by adhering to the Obama-era standards.

Here the state is relying on a special legal prerogative that operates in tandem with its size and economic heft. Because Congress gave California the legal power and the market gave California its economic influence, it’s hard to criticize it for being prepared to act in the interests of the environment. If the state is acting like an independent country, that’s because in this area, it’s supposed to do so.

Finally, immigration is an area where California is cleverly deploying constitutional federalism to resist Trump’s enforcement policies. Historically, liberals haven’t much liked states’ rights strategies. The best that can be said for California’s states’ rights resistance is that turnabout is fair play.

The takeaway is that California has several tools it can use to promote its own independence. These often go beyond what most other states can do in experimenting with going their own way. Whether you like them or not is going to depend a whole lot on whether you prefer California’s current liberal, pro-environment policy or that of the current federal government.

Meanwhile, Texas can eat its heart out. California is more independent — at least for now.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

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