In recent years, the growth of the federal government and its failure to resolve many major problems have ignited a serious new debate. Some scholars and policymakers suggest that reinvigorating American federalism - returing a variety of regulatory and police powers back to the states - may better solve many of these problems. Others claim that it will gut policies or cripple national regulation. This book confronts these issues as it investigates the central question of the new American federalism: Will it yield better government, in doing so it poses the provocative question, Can the states be trusted? Proponents of greater federalism argue that it creates competition and fosters the 'laboratory of the states.' Opponents claim that decentralizing power to the states will lead to a 'race to the bottom.' The contributors to the volume examine the current state of knowledge and evidence about both sides of the argument and offer A historical and constitutional perspective that raises important questions for the contemporary debate The main lessons of modern economics applicable to the new federalism Evidence on interstate competition in three important policy domains: welfare, the environment, and corporate law An outline of the relative merits of a statutory versus a constitutional basis for the new federalism The authors of the The New Federalism: Can the State be Trusted? conclude that the answer is a qualified yes. The studies in this volume find little evidence for a race to the bottom in three major policy domains. This book should be an invaluable resource to federal and state policymakers alike.