In: Economics
Confederation is an association of states that unify into one state for common socio-economic goals. They are together known as one country but in effect work as a federation—with a center and a conglomerate of states. The highlighting aspect pf a confederacy is the ‘independent’ authority of the states, the center and the states however have to work according to pre-determined agreements of power sharing.
The founders initially choose a system of confederation as it gave more ‘freedom’ of administration to the states, more flexibility of governance and lesser concentration of power in a few hands or a single hand.
The articles of confederation sought to implicitly highlight the autonomy of the states, giving lesser ‘power of control’ to the center. This is a disadvantage since a powerless center can effectively lead to the dominance of the ‘states’ power’ in national arena, the dominant states could project their needs to be more important than the others and it could lead to the end result being a lop sided administration.
The lack of clarity in the power-sharing ratio of the center and the states, the structure of the system of confederation which has a more autonomy of the federations than the central power of governance have been specific reasons for the failure of such a system. A central government with comparatively the same or lesser powers of administration than the state governments will not be effective in pursuing common national objectives. The center has only a coordination role , this y lead to the rise in the power of some states who were more bigger and had more ‘power to act’ in the confederation compared to other states. The dominance of some states over the others lead to suppression of national , unified interests for the interests of a few states lead to the failure of the confederacy system of political governance. The structure highlights ‘a convenient’ power sharing set up rather than highlighting the dominance of national welfare over individual state’s growth. It lead to an ineffective decision making system since the governance was more in a manner that required a coordination among the states and the center which created time lags in administrative set up, this delayed the power of the center to act immediately, especially when situations warranted immediate action and hence proved the inadequacy of the confederation type of set up .
Any political system that seeks to suppress common national goals will not be able to with stand itself for long. The lack of common unified interests and the lesser control of the center over the state will lead to the emergence of bureaucratic interests that try to’ monopolize’ powers in administration .
Daniel Shay , a leader who unified people to fight against the evils arising out the domineering states of the confederation is worthy of discussion since ‘Shays rebellion’ , is the consequence of ignoring the demerits of a confederation type of political set-up.
The rebellion , like many others was the result of oppression at the grass roots level. The economic set-up , in the nation was mostly a self reliant barter based exchange , especially in villages, the credit system was mostly on informal lines, and the farmers and other small time entrepreneurs took credit from bigger business men , on informal basis , repaying when they had sufficient money in hand. However, due to certain external disturbances this informal system was affected, the farmer and other small time local businessmen found themselves hard pressed for money on the one hand and higher rates of taxation on the other hand. The center could not prove effective in controlling the taxing powers of the confederation’s states. The local population was encircled in a debt-tax trap with low or no assets to meet the obligations.
It highlighted the domineering capitalistic class struggle –with the suppression of the have-- nots ( the economically poor people) by the haves--(the economically richer people)
The haphazard manner of taxes being imposed and collected with the chief objective of raising funds and not for public spending, the lack of active government participation in governmental administration, the dormant center had all lead to the ‘divide between ‘ the capitalist rich merchant dominated class and the oppressed common class. The inability to pay taxes coupled with lack of incomes to meet their debt-obligations led to the uprising of the ‘Shay’s rebellion’. A signalling movement that highlighted the defects of the ‘confederation’ set up and put them out on the national arena.
It has been the base for the recognition of a change in the socio-political set up and the need for a strong common economic welfare objective to dominate over the interests of the states. The rebellion highlighted the demerits of capitalism, which was alarming to the political set-up since the economy was essentially a capitalist economy, with minimum government control or interference and a strong domination of the market forces of demand and supply in the economic activities of production, consumption, exchange and distribution. It also brought to fore the truth that society’s welfare cannot be compromised I the larger interest for long. It highlighted the need to have a greater ‘powerful center’ that would have more administrative powers over the states and will effectively veer them towards the welfare of the economy as a whole.