The Constitution gives three types of power to the national government:
Some powers of federal and state governments overlap. For example, both may collect taxes, make and enforce laws, and borrow money.
Prohibited powers are denied either to the national government, state governments, or both. For example, the national government cannot use its powers in a way that interferes with the states' abilities to perform their responsibilities. States cannot tax imports or exports, nor can they coin money or issue bills of credit.
States also have responsibilities to one another. Each state must accept the public acts, records, and civil judicial proceedings of every other state. Business contracts and marriages are recognized by all states. Extradition, the legal process in which an accused criminal is returned to the state where the crime was committed, is also required.
The founders carefully divided powers between federal and state governments. The federal system that balances state and national powers helped them guard against autocracy, allowed citizen participation in government, and allowed new policies and programs.
Source: The Founders and Federalism
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