Ruth Mason (Connecticut) presents Federalism and the Taxing Power, 99 Cal. L. Rev. ___ (2011), at Queen’s University (Canada) today as part of its Law, Economics & Public Policy Workshop Series. Here is the abstract:

As many scholars and courts have recognized, the federal government uses its virtually limitless Spending Power to enlist states in achieving federal goals, thus enlarging its powers far beyond those enumerated in the Constitution. Previously unnoticed, however, is that the federal government can achieve similar ends – it can essentially regulate the states and private parties through its equally broad Taxing Power. For example, over time, Congress has littered the tax code with special deductions and credits designed to achieve social objectives, and many of these so-called “tax expenditures” represent federal spending outside of the areas of Congress’s enumerated powers. To a lesser extent, Congress also employs what might be called “tax penalties”. Tax penalties are special tax code provisions that increase the normal tax burden, and, like tax expenditures, Congress uses them to induce taxpayer behavior. This Article discusses the federalism implications of the Taxing Power and, assuming that tax spending and conditional spending are both valid exercises of Congressional power, it compares them from a purely instrumental perspective as means for achieving federal regulatory goals.