Philippine Journal of Public Administration, Vol. XLVI, Nos.

1- 4 (January-October 2002)

Federalism: The Case of Switzerland

WOLF LINDER*

Federalism remains one of the most important elements of

modern statehood. It allows for highly decentralized governance close
to the people, for public services and goods of high quality at low tax-
level for the citizens, and for a civic culture trusting the capacities of
small political units. Historically speaking, the Swiss federation can
be considered as a case of "non-centralization. n During the creation
of the federation in 1848, the cantons kept their statehood, their
constitutions and most of their political autonomy. Today, the central
government is controlling only about 30 percent of the overall public
budget; thus the Swiss federation has remained one of the most
decentralized countries. In a historical perspective, federalism has
allowed Swiss nation building as a bottom up process. As an element
of political power sharing, federalism protected some minorities, the
cultural heritage and diversity of the cantons, and helped to integrate
the different segments of Swiss society. In a comparative perspective,
Switzerland belongs to the good cases in which federalism has helped
to deal peacefully or even to avoid multicultural conflict. Moreover,
the Swiss case illustrates the possibility of successful nation building
despite cultural fragmentation. Both points are important today, as
many young democracies of developing countries are facing similar
conditions.

Switzerland in the European Context

Switzerland is a small country situated in the center of Western Europe.

Geographically, 60 percent of its surface of about 42,000 km 2 belongs to the
mountain region of the Alps; flat lands count only about 30 percent.
Switzerland's seven million inhabitants constitute about two percent of the
population ofWestern Europe. With more than 170 inhabitants per km", it has
one of the highest population densities in Europe. Once a poor region of
mountain farmers without natural resources, Switzerland has in the last 50
years become one of the richest Organization for Economic Cooperation and
Development (OECD)-countries. Its Gross National Product (GNP) per
inhabitant was about US$32,300 in 1999. Most important industrial branches
are banking, chemistry and pharmaceuticals, machine industry, watches and
electronic devices, and tourism. With high import and export rates,
Switzerland is strongly dependent on the European and world market, yet,

*Professor, Political Science, Institut fur Politikwissenschaft, Switzerland.

Paper prepared for the 2Dd International Conference on Decentralization (lCD) with the
theme "Federalism: The Future of Decentralizing States?" held on 25-27 July 2002 at the
EDSA Shangri-la Hotel, Manila, Philippines.

146
 FEDERALISM IN SWITZERLAND 147

has maintained its ability to compete in many industries. In exported goods, it

ranks about tenth in the world and among foreign investors, it counted fifth in
1994. I

The Swiss society can be considered multicultural in several aspects.

Native peoples have different histories and cultures. They speak four different
languages: 65 percent German, 20 percent French and ten percent Italian.
The fourth language, the Romansch speakers, are a tiny minority of less than
one percent. By religion, the country is divided into 48 percent Catholics and
44 percent Protestants, the rest being of other religions or non-believers.
Today, 20 percent of the inhabitants of the country are foreigners. This strong
immigration was mainly due to the working force demand of the growing
Swiss industry after World War II.

The political stability of Switzerland is outstanding. For more than 40

years now, the Federal Council, the seven-member head of the Swiss
government, is composed of a successful coalition among the same four
( political parties representing about 75 percent of the electorate. Switzerland
thus belongs to the type of consensus democracies characterized by political
power sharing. Political solutions are not found by majority decisions but
through negotiation and compromise among the important political parties.
Beyond elections, the Swiss people participate directly in the most important
political decisions. Using the instrument of the referendum and the popular
initiative, they can have the last word on the parliaments' decisions and
forward proposals for constitutional amendments which then become a subject
for a popular vote. Direct democracy, rather than bringing about a revolution,
has contributed to political stability, integration and to consensus democracy
(Linder 1994: 5-37).

Switzerland's foreign policy is characterized by its long standing armed

neutrality. It was particularly important in the 20 th century, when
Switzerland was one of the few European nations not involved either in the
First or the Second World War. On the one hand, Switzerland is actually well
integrated in international organizations such as OECD, World Trade
Organization (WTO) or the Bretton Woods institutions. On the other hand,
Switzerland, because of its policy of neutrality and its will for national
autonomy, is very reluctant with regard to political integration in Europe and
the global world. Switzerland is neither a member of the European Union
(EU) nor of North Atlantic Treaty Organization (NATO). It was one of the last
countries to become a member of the United Nations (UN) but the first which
made this step by a popular vote in 2002.

2002
148 PHILIPPINE JOURNAL OF PUBLIC ADMINISTRATION

Origins of the Swiss Federation

The origins of Switzerland date back to the 13th century when three tiny
alpine regions, later followed by some cities, declared themselves independent
of the Habsburg regime. They were able to maintain this independence during
centuries through mutual military assistance. After the French Revolution, 25
cantons, considering themselves sovereign states, reestablished a treaty to
guarantee collective security by mutual assistance. This system of a loose
confederation did not prove efficient for a majority of the cantons. They
wanted a central government that would keep up with the requirements of
state building, modernization and economic development that took place in
the surrounding countries of Germany, France, Italy and Austria.

In 1848, the Swiss Federation was created through a Constitutional Act

which was approved by the majority of the Cantons. The creation of this
Federation was a political compromise between the two major political forces:
the Radicals, the innovative force, mainly from urban and protestant cantons \
who wanted industrialization and a strong central government; and the
Conservatives, the rather retarding force, mainly from rural and Catholic
regions who feared to be overruled by the protestant majority. Thus, we can
say: federalism was the durable power- sharing arrangement between those
wanting a strong central state and those wanting to maintain the status quo.
By all means, to find a compromise was not easy. In earlier centuries,
Catholics and Protestants had fought four civil wars against each other.
Moreover, the inhabitants of the Swiss cantons spoke four different
languages, had different histories and cultural heritages. They were deeply
segmented and partly divided; a single and homogenous Swiss society did not
exist.

How was it possible to create a nation-state despite these unfavorable

factors? Besides political pressure from the outside and the economic
advantages of cooperation within a larger territorial state, four institutional
points made Swiss nation building successful:

A Political Nation-State for a Culturally Segmented Society

The Swiss nation-state was a multicultural nation-state from the

beginning. It was not created on the principles of a common language, religion
or ethnicity but on the abstract principle of citizenship. The Constitution of
1848 defined that it is the cantons and their peoples who constitute the Swiss
Federation. Thus, the Swiss nation-state is a political, not a cultural, nation-
state.

January-October
FEDERALISM IN SWITZERLAND 149

Bottom-up Nation Building Respecting Regional and Local Autonomy

Only a few competencies were given to the central government, such as

the military and foreign relations, while the cantons kept the utmost political
autonomy and statehood with their own constitutions, their own' rights of
taxation, and their own responsibilities. Until today, the central government
cannot get any new responsibilities or competencies without the explicit
consent of the cantons. This means a bottom-up nation building which is
characterized by non-centralization. Federalism, in this context, means a
vertical power sharing device. It allowed the cantons to keep their own
traditions, their cultural as well as their political identity. Moreover; it was a
durable arrangement of power-sharing between the protagonists of
centralization and their opponents.

Strong Political Participation of the Cantons

in Federal Decisions

Following Duchacek (1985: 44), "decisive participation (of the

subnational units) in amending the constitution" is one of the yardsticks of all
federal systems. Swiss federalism goes far beyond. The Swiss cantons
participate in all federal affairs, be it amending the constitution, enacting
new legislation, or implementing federal affairs.

Through full bicameralism consisting of two legislative chambers, the

cantons have their say in federal legislation. The cantons are represented in
the Council of the States, the second chamber of the Swiss parliament. It
resembles the role of the Senate in the bicameralist United States (US)
parliament. To become valid, a parliamentary decision needs the majority of
the Council of the States and the National Council representing the people
(Jaag 1976). Each chamber has the same competencies and deliberates all
issues one after the other. As discussed later in this article, the institutional
devices of the participation of the cantons include processes of direct
democracy and of consultation. Thus, all important federal decisions are
subject of a double decision rule: the democratic rule after the principle "one
person one vote," and the federalist rule after the principle: "one vote for each
member state."

Proportional Representation of the Different Political Cultures

From the beginning, many federal institutions were designed for

proportional representation of different languages and cultural segments of
the cantonal peoples. Thus, the executive branch consists of a collegiate body
of seven members, who decide collectively on all important government
matters. In order to integrate the different linguistic regions, the parliament

2002
150 PHILIPPINE JOURNAL OF PUBLIC ADMINISTRATION

elects representatives of all of the three important regions of the country.

Proportional representation of the different linguistic groups, today, is
practiced in all branches and for all hierarchical levels of the federal
government and its administration.

Swiss Federalism Today

Basic Structures of the Federal System

As shown in Table 1, the Swiss federal system consists of three levels.

The Federation, the 26 cantons and about 3,000 communes elect their own
political authorities (Lutz/Strohmann 1998). At each level, a separation of
powers can be found with the executive, the legislative and the judicial
authorities.

\
Table 1. Basic Structure of the Swiss Federal System \

\
Executive Power, Legislative Power Judicial Power

Federation Federal Council Federal Assembly Council of the Federal Supreme

Seven Federal National Council States Court
Councillors 200 National 46 State Council- About 75 Supreme
elected by the Councillors elected lors elected by Judges
Federal Assembly by the people the people Elected by the
for a period of 4 Number ofrepre- Each (half) canton Federal Assembly
years sentatives of each elects (one) two
One of the canton depends on representatives
Councillors acts population size of
as President the canton
Rotation every
year

Cantons Cantonal Council Cantonal Parliament Cantonal Court

5-7 members, 46-200 members, elected Election through
elected by the by the cantonal people Cantonal Council
cantonal people every 4-5 years or Parliament
every 4-5 years

Communes Communal Council Large Communes (cities) District Court

Elected by the Parliament elected by the Elected by
people people authority or the
Small Communes people of the
General Assembly of all district
citizens

Source: Linder 1994: 9.

The political autonomy of the subnational units is "ample. It is

guaranteed through different institutional devices.

January-October
FEDERALISM IN SWITZERLAND 151

The Cantons. It is noteworthy that they have their own constitutions.

These constitutions must respect the principles of democracy, must guarantee
fundamental rights and the rule of law as prescribed in the federal
constitution. But they allow the cantons to have their own political
organizations, their own political authorities free from influence of the federal
government, and an ample autonomy in legislation, in preferences for their
own policies of public goods and services, taxation, and financial policies as
well.

The Communes. Much of what is said of the cantons applies also to the
communes. They have a right of existence protected by the 'Supreme Court
similar to a fundamental right. Thus, no commune can be merged with
another against its political will. Communes have their own political
organizations, and their own policies with regard to the production and
distribution of local public goods. Most important, they have a large autonomy
in questions of local taxes and in their financial policy (Linder 1994: 49-54).
,

Intergovernmental Relations

Responsibilities of the Federation, the Cantons and the Communes. New

public responsibilities are first introduced at the local or at the cantonal level,
As already mentioned, they can be transferred to the national level only if the
people and the majority of the cantons approve such a proposal in a popular
vote. Roughly, each group (the communes, the cantons and the Federation)
controls about one third of the revenues and expenses.

Central government is mainly responsible for foreign policy, national

defense and social security, national infrastructure and services, like
telecommunication, and legislation for commerce, civil and penal laws. The
canton's main competencies lie in the police, schools and public education,
while the communes are responsible for all local infrastructure, social
services, land use planning, and natural resource management. Originally,
competencies between the three levels were sharply separated. Today, an
intensive cooperation between the three tiers can be found. For instance,
parts of the social security system is national; others are local. In many policy
fields, the Federation is responsible for the general legislation, while cantons
and communes are in charge of special legislation and implementation.

Financial Compensation. The Swiss cantons are unequal in two

respects. The first is the difference in the population size. While the biggest
cantons, like Zurich or Bern, count for about one million people; the smaller
ones, like Uri or Appenzell, have just a few ten thousand inhabitants. Second,
there is the economic inequality. Rural and mountain regions are relatively
poor in comparison to some urban cantons. For both reasons, Swiss

2002
 i
152 PHILIPPINE JOURNAL OF PUBLICADMINISTRATION

federalism, the so-called "cooperative federalism" provides financial

compensation. It serves to adjust differences in financial revenue and
expenditure between rich and poor cantons or communes, or to pay the bigger
cantons for the services they provide for small cantons which the latter do not
provide themselves (Kloti 1988).

Advantages and Disadvantages of Decentralized

Production of Public Goods and Services

In international comparison, Switzerland is one of the most

decentralized countries (Table 2).

Table 2. Central Government Revenue and Expenditure Share

(in percent of all public revenue and expenditure, 1973-95)
I
Revenue Expenditure
·1
Federalist States f'
Switzerland 27 30.6
Germany 33.4 30.6
Austria 51.8 56.0
USA 41.0 45.8

Non-federalist States

Denmark 60.9 71.4

Great Britain 73.9 83.1
France 48.9 44.6
Netherlands 56.4 56.7

Source: Linder 1999a: 150.

The advantages of a decentralized production and distribution of public

goods and services can be described as follows:

• Cantonal and local governments are closer to the people and,

therefore, more responsive to the preferences of the regional
people. This is not only due to decentralization but also to the
institutions of direct democracy, which allow citizens to express
their preferences in state and local legislation.

January-October
FEDERALISM IN SWITZERLAND 153

• Decentralized production of public goods and services is highly

productive as it escapes the risks of too much bureaucracy. Indeed,
despite high quality of public services, government consumption in
Switzerland is one of the lowest in OECD countries.

• Cantonal and local governments learn from each other. In new

responsibilities, for instance in environmental or acquired immuno
deficiency syndrome (AIDS) policy, one can observe that some
cantons take a pioneer role. The process of trial and error takes
place, then the best practices are developed, and, finally, the other
cantons share the experience of the pioneers. This process of
innovation through learning processes among cantons or communes
has become more and more important.

On the other hand, decentralized production has some disadvantages:

• Some of the cantons or communes do not have enough resources

and capacities to deliver technically complex services. The practice '
is that they buy them from the stronger cantons. The inconvenience'
is that the small cantons, in this case, can no longer live up to their'
political autonomy. Policies of compensation for economic
inequality are complex and not always successful.

• Regarding certain public goods, small cantons are not large enough
to profit from economies of scale. Some people claim that the Swiss
polity is too much decentralized and that production of many public
goods is sub-optimal or ineffective.

• While innovation in the interest of the cantons is effective through

mutual learning processes, innovations of the central government
are sometimes difficult. Usually, it is the cantons or the communes
who implement federal policies. This means that the subnational
units have strong veto points: If cantonal or local consensus for a
federal innovation is low, it runs a considerable risk of being
blocked or neutralized in the implementation process.
• A weak innovation pace of the federal government can be
considered as the "price" of the Swiss preference for
decentralization. This price is valued differently: Some people
deplore that Swiss politics is not capable, today, to keep up with the
process of globalization which demands quick innovation. Others
insist that slow innovation is a virtue because it avoids the costly
failures of rush-and-run or stop-and-go-policies.

These effects are the result of the particularities of the political process.
Political processes in a federalist system are complex because they involve
actors from different levels of the political system (Wili 1988). Moreover,these

2002
154 PHILIPPINE JOURNAL OF PUBLIC ADMINISTRATION

multilevel processes imply processes of negotiation and compromise, in which

federal politics have to overcome the veto points of subnational units
(Papadopoulos 1997). The following section, gives an overview of the basic
characteristics of the federal policymaking process.

The Political Process: The Influence of the Cantons on Federal Politics

Division of Power Between the Federation and the Cantons. As already

mentioned, Switzerland remains as one' of the most decentralized countries.
Despite some centralization over the last decades, the cantons and the
communes still control about two thirds of the public financial and personnel
resources. They are the main responsible actors in a wide range of policy
programs and playa prominent role in implementing most federal programs.

One reason for this non-centralization is obvious: according to the basic

constitutional rule, every transfer of power to the federation requires a
constitutional amendment which is subject to a popular vote. The double
majority of the people and the cantons is a high hurdle to pass. Indeed from
1848 to 1997, almost one third of the 140 constitutional amendments proposed
by the Federal Chambers failed in the vote, and the success rate of the 121
popular initiatives was less than ten percent. Moreover, the parliament is
conscious of the difficulties winning a majority among the politically
heterogeneous cantons and therefore is cautious in its propositions for new
federal competencies.

A comparative look at the US tells, however, that a similar constitutional

rule on the federal division of power need not necessarily produce the same
results. Like the Swiss, the US Constitution needs to be amended for the
extension of competencies of the central government. Confronted with similar
political difficulties of ratification by the Senate and the states, the US
authorities chose another way to extend feder al competencies. Instead of
seeking formal changes in the constitution, the US government appealed to
the Supreme Court which, under legal notions of "implied powers" or the
"interstate commerce clause," acknowledged many new competencies of the
central government. Neither the government nor the parliament in
Switzerland has chosen this way of bypassing formal amending of the
constitution. Instead, they extended central powers by many modest
amending steps that had a chance to be approved by the heterogeneous
cantons and by the people. Thus, if both federations in the last 150 years
considerably extended the powers of their central government, they have done
so in different ways: the US through authoritative judicial review that
produced "new" competencies from the same constitutional document, the
Swiss authorities through the political way of formal amendments approved

January-October
FEDERALISM IN SWITZERLAND 155

by the people and the cantons (Linder 1999b). This may be the second reason
why the Swiss federal system so greatly resisted centralization, and why the
development of national economic and social policies was relatively late and
modest.

The Double Majority Rule in Popular Votations as a Veto Power Device of

Small Cantons. The two different majority rules-democratic and federalist-
can produce different results for the same decision. In bicameral lawmaking,
this is not a particular problem. If the National Council and the Council of
State end up with different decisions on the same bill, they engage a common
procedure to eliminate differences. This procedure cannot be applied in a
popular vote, when a particular constitutional amendment may obtain a
majority from the people, but is rejected by majority of the cantons, and vice
versa. In this case, the status quo ante prevails. Between 184$ and 1999,
there were ten collisions, six of which occurred only in the last thirty years.
The collision between the democratic principle of "one person one vote" and
the federalist principle of "every canton an equid vote" can become
problematic (Germann 1991). It means that a majority of 13 small cantons-
representing only 20 percent of the population-can block a democratic
majority of 80 percent of the citizens. And it means that one vote of the small
canton of Uri can cancel out 34 votes from the largest canton of Zurich when
the federalist majority is counted.

Today, the double majority rule is of particular significance in issues of

foreign policy. The Swiss people are deeply divided on the question whether or
not Switzerland should join the European Union or abandon its old neutrality
in foreign policy. In this cleavage, the small, rural and German speaking
cantons are strongholds of the non-integrationist conservatives, whereas
bigger, urban or French speaking cantons are on the modernist. side that
wants to open up Swiss foreign relations. Even though there is nota collision
case, the double majority rule gives the non-integrationist conservatives a
systemic advantage: they profit from their strongholds in the small, rural
German speaking cantons. '

In sum, the double majority rule in direct democracy is an effective veto

power device. Because of the relatively homogeneous preferences of the small
rural cantons against state intervention and policy changes in many fields, it
has even more political impact than in 1847 when it was designed for the
losers of the Catholic minorities who were against centralization. But one can
doubt whether a federalist overrepresentation is a wise institutional design
also in matters of foreign policy. Moreover, the problem of collisions in
popular votes leads the country to the fundamental question as to what
degree it is justified that a small minority of the electorate can overrule a
democratic majority (Vatter/Sager 1996).

2002
156 PHILIPPINE JOURNAL OF PUBLIC ADMINISTRATION

Bicameral Lawmaking and Cantonal Interests. Lawmaking in the Swiss

Parliament reflects the equal importance Of democratic and federal influence.
Both chambers may initiate constitutional amendments, new bills and
regulations, as well as propose the revision of existing laws and regulations.
Every proposition or bill destined to become a federal law has to be approved
by a relative majority in both chambers (Trivelli 1975; Luthi 1999). How does
this strong element of federalism work out in lawmaking?

Public opinion still considers the Council of the States to be a stronghold

of cantonal interests, as was the intention of the fathers of the Constitution.
And there is a strong argument that especially the small cantons, which are
rural, can form a powerful coalition in the Council of States. Theoretically, the
23 Councillors (of 46) of the smallest cantons which represent only 20 percent
of the population have a veto power on any decision of the Swiss parliament.
According to Lijphart (1999: 208), Switzerland ranks highest on a Gini index
of inequality among nine federal chambers.

Empirical research shows that the "federalist effect" of decisions in favor

of small and rural cantons sometimes works out but should not be
overestimated, mainly for two reasons. First, the overrepresentation of small
cantons is not the only one in the Council of States. Due to the mode of
election, the bourgeois parties are overrepresented, the political Left
underrepresented. In the last hundred years, this Left-Right cleavage has
become much more important than the federalist-centralist cleavage between
Catholics and Protestants in the 19th century. Thus, more than being a
"federalist chamber," the Council of States is a chamber favoring bourgeois
policies. Second, the Council of the States is not a federalist institution
because unlike the German Bundesrat, it is not a representative of the
executive of the member states (Heger 1990). Its members are responsive to
their cantonal constituencies and therefore defend mostly the same group
interests as can be identified in the National Council (Neidhart 1975).

Under the aspects of political legitimation, however, the Swiss Council of

States is still a symbol of cantonal representation-the people believe it is and
the Councillors also feel so. Yet, in political decisionmaking, the Council of
States is not more inclined to articulate and defend cantonal interests than is
the National Council. Thus, one might come to the same conclusions as
Tsebelis and Money (1997) in their comparative study: The common effect of
bicameralism is a bias for the status quo. Or, in the formula of Thomas
Jefferson: if the tea is versed from a first into a second cup, it is less hot to
drink.

The Influence of the Cantons on Federal Policy Formulation. If the

specific federalist role of the Council of States is rather weak, this does not
mean that cantonal interests are not articulated at all. Indeed, looking at the

January-October
FEDERALISM IN SWITZERLAND 157

whole policy-cycle, it can be found that in the two phases of policy formulation
and implementation, the influence of the cantons is rather strong. In the
Swiss decisionmaking process, policy formulation is tied to an extensive "pre-
parliamentary" process' of participation and consultation. It takes place before
the government hands its project over to the Federal Chambers. The pre-
parliamentary stage consists of two phases, the evaluation or even elaboration
of a first draft of the bill by expert commissions, and the consultation
procedures in which political parties, the cantons, as well as economic,
professional and social organizations pronounce themselves on the draft of the
bill. The function of this pre-parliamentary stage is to prepare consensus for
the bill and to reduce the risks of a future defeat in a popular vote. Thus,
when the Federal Council nominates a committee of experts to evaluate the
various options of a new bill, it is especially concerned with appointing
members who represent the standpoints of the different interest groups. As
Germann (1981: 63) showed in his extensive study, the cantons, especially the
representatives of urban regions, were called to participate on average in
more than three out of four extra-parliamentarian commissions in the 1970s.
A similar result can be found for the consultation procedure. On average, the
cantons participate in no less than nine out of ten consultation procedures
(Germann 1986: 350).

However, the cantons are not always powerful in influence. In the pre-
parliamentary process, they are competing with other group interests which
are sometimes more influential than the cantons. Thus, the bargaining power
of the cantons varies from one policy field to another. Their influence is
particularly strong in policy fields in which the central government depends
on the implementation resources and experiences of the cantons (Vatter
2001).

The Cantons and the Implementation of Federal Policies. The arena with
the highest influence of the cantons and the communes as well is to be found
in the implementation of federal policies. Today, this process is characterized
by a high degree of cooperation between the subnational units and the federal
government. Most federal programs are implemented by the cantons and the'
communes. With some exceptions, there is no parallel federal administration
with its own regional services, agencies or even courts, and only very few
federal services deal directly with the public. The complexities of modern
infrastructure, economic intervention and social policies stimulated the
development of a cooperative federalism. In many policy fields, one of the
main characteristics is the shift of basic legislation competencies to the center
while the cantons regulate the implementation process and its modalities.
Institutionally, it involves different levels of government cooperation in the
same policy program. As already mentioned, this has simultaneously led to a
broad system of financial compensation between the federation, the cantons
and the communes that comprises revenue-sharing as well as financial

2002
158 . PHILIPPINE JOURNAL OF PUBLIC ADMINISTRATION

compensation by block grants and subsidies (Fagagnini 1991). A further

ocnsequence of the strong position of the cantons in the implementation
process is the absence or only very reluctant use of coercive means by the
'federal authorities. Thus, the implementation of central government programs
cannot be taken for granted in every case. Much depends on the political will
at the subnational level. Sometimes, minimal legal standards in the
application of federal law can only be assured by review through the Supreme
Court. A prominent case was Appenzell I.Rh. When women's suffrage was
introduced in 1971 on the federal level, Appenzell men refused to do so in
their canton. It was only in 1990 by decision of the Supreme Court that the
canton fulfilled its obligation (Linder 1994: 69).

Self-coordination Between the Cantons. Thus far, this study has

considered the "vertical" instruments of Swiss federalism that concern the
relations between the federation and the cantons. This section of the study
gives an account on instruments of self-coordination between the cantons, or
of the "horizontal instruments" of "cooperative" federalism which allow the
cantons to take collective action without the involvement of the federation.
There are two types of them: intercantonal organizations and agencies, and
"concordats," a form of contractual cooperation.

The traditional instrument of horizontal cooperative federalism are the

concordats, i.e., intercantonal treaties functioning as instruments of regional
cooperation. The concordats allow the subnational units to regulate
administrative, legislative, and juridical matters among themselves. However,
there are severe limits of this instrument. Concordats are most effective if all
cantons subscribe but it is difficult to reach unanimity. So, the particularism
of half of the cantons starting the school year in Spring and the other half of
the cantons in Autumn could not be overcome by a concordat for a long time.
Nevertheless, the instrument of the concordat can serve cooperation, and the
cantons are driven by the same and permanent interest of defending their
own competencies and of preventing a central government regulation.

Intercantonal organizations play an important role as consultative

institutions. They provide a forum to share experiences and to coordinate
tasks between cantonal politicians and officials. Today there are more than
500 intercantonal organizations, with the Conference of Cantonal Ministers
traditionally being the most influential (Frenkel 1986: 330ff.). In the last ten
years, the Conference of Cantonal Governments was established as another
organization (Munger 1994). With the aid of this body, the cantons attempt to
extend their direct influence on the Federation especially in the field of
foreign policy and to secure a coordinated definition of problems. Thus, in the
90s, and, especially on the question of Switzerland's integration to the EU, the
cantons have significantly increased their influence in foreign policy.

January-October
FEDERALISM IN SWITZERLAND 159

At the local level, there is a similar pattern: Communes organize

themselves to decide or to implement policies on a regional level. The leading
motive is the same: communes prefer self-coordination rather than delegating
competencies to the canton.

In conclusion, the horizontal instruments of federalism have to be judged

critically. On the one hand, they are an expression of the political will of the
subnational units to maintain their competencies through own efforts of
coordination and seek collective advantages through cooperation. On the other
hand, they sometimes impede coordination with upper levels of government.
The main weak point of the horizontal instruments, however, is their
technocratic character and the lack of political control by legislative
authorities.

Policy Outcomes

General Characteristics of Federal Policies. Comparative studies show

that Switzerland has one of the lowest rates of state consumption of all OECD
countries. As already mentioned, the proportion of revenue and public
expenditure between the Federation, the Cantons and the Communes is about
30:40:30 percent, which means the central government controls less of the
public budget than all other federal states. Until today, the Swiss federal
government may be the only one in the world that cannot rely on durable
revenue taxes from its inhabitants.

It may be difficult to attribute these characteristics to federalism only.

Indeed, it is plausible to conceive them as a combined effect of federalism and,
direct democracy. This is in line with the perspective of the new
institutionalism (March/Olsen 1996). Representatives of this approach
emphasize that counter-majoritarian institutions such as federalism and
direct democracy function as particularly powerful institutional veto-points:
They set limits to the scope of action of the central government. Subnational
actors, on the one hand, use their veto power in order to block centralization
and policy changes which are not in their interest. On the, other hand,
subnational actors have their own interest in national policies-for instance to
participate in the central budget or to promote their own preferences which
have not yet found a majority at the national level. In both cases, federal and
subnational actors have to engage in negotiation and coordination processes
in which the least common denominator between many actors has to be
sought. If subnational units have heterogeneous interests and resources of
their own, federalism tends to favor decentralized policy solutions and sets
limits to expenditures of the central government. In addition, heterogeneous
preferences of subnational units imply a systemic bias for the status quo and
for incremental politics. This leads to political stability but prohibits quick or
major policy changes in the federal system (Linder/Vatter 2001).

2002
160 PHILIPPINE JOURNAL OF PUBLIC ADMINISTRATION

Such effects can be demonstrated in particular by looking at the

development of the Swiss welfare state. In his study, Obinger (1998: 257-259)
concludes that the close interplay between direct democracy and federalism
generated three major effects on the Swiss welfare state development,
"namely a lag effect, a structural effect and a restrictive impact on welfare
state funding. Together, these three effects largely explain the liberal
trajectory and the belated formation of the Swiss welfare state from a
comparative viewpoint."

• First, due to the fact that almost all competencies in social policy
were originally in the hands of the cantons, it took a long time to
transfer the power in the field of social security to the central
level, since all constitutional amendments required a double
majority of the people and the cantons in mandatory
referendums.

• Second, the lack of a comprehensive federal social policy was

compensated by private welfare organizations. "Since the
federation's policies were vetoed, the central government, as well
as the cantons, began to subsidize the social security programs of
these private carriers. This led to the emergence of a peculiar
public-private mix in the field of social policy."

• Thirdly, the federal government had only limited fiscal capacity

and a narrow tax basis which reduced its ability to fund welfare
state programs in a generous and constant way over a longer
period of time. Political scientists and economists generally agree
on these points: the institutional veto points of direct democracy
and federalism were the decisive factors that set limits to the
expansion of public policies, confined centralization and hindered
expansive public spending as well as high taxes in the federal
system.

Implementation of Federal Policies: The Political Factor. Many case

studies have confirmed that the degree of political consensus on the federal
and the cantonal level is the most important factor of policy implementation.

In the multilevel arrangement of "cooperative federalism," the degree of

consensus can be different at the federal and the cantonal level. Innovations
of federal programs, even though supported by a high federal consensus, can
be compromised through cantonal vetoes. On the other hand, certain cantons
may have strong preferences for own innovations which do not find a majority
at the federal level. This leads to different implementation chances of federal
policies that can be conceptualized in Table 3.

January-October
FEDERALISM IN SWITZERLAND 161

Table 3. Consensus Constellations and Implementation Chances

Cantons: Strong Consensus Cantons: Weak Consensus

Federation:
Strong consensus I Full implementation II Partial implementation
of federal program

Federation:
Weak consensus III Deviation from federal IV Poor or no implemen-
program tation

Source: Linder 1999a: 178.

Field I is the least problematic: under the condition of high consensus on

the federal and cantonal level, policy programs are implemented with high
success. There is ample empirical evidence that under this constellation, the
system of "cooperative federalism" can make proof of its qualities: the cantons
compensate for eventual weaknesses of the federal legislation, share
implementation experiences and are willing to learn from each other.

Field II, however, is a more frequent case. Federal policies are blocked
by vetoes from a part of the cantons. The different political preferences of the .
cantons are more decisive than all other factors. Comparative studies have
shown that the implementation of federal housing programs or employment'
programs for refugees depends less on the housing or job market of a canton.
than on the strength of political parties for or against these programs. One
could say that this field shows the crucial weakness of a federal system in
which even clear decisions of the central government cannot overcome
subnational veto positions-as in the mentioned Appenzell case of women's
political rights.

Field III is characterized by a weak federal legislation, while the cantons

strongly support their own objectives in the same policy field. These objectives
can be in line with federal legislation but in many cases, the cantons have
other policies in mind. In this situation, the cantons use the federal policy alii
an instrument to promote their own, deviating objectives. On the one hand,
this can be interpreted as the typical weakness of a federal system in which
the central government has not enough power to overcome subnational vetoes.
On the other hand, one could argue that it is exactly the strength of a federal
system that subnational units develop their own policies if decisions of central
government lack a clear political consensus and support. Indeed, when the
federal policy was blocked in the 80s in the conflict continuing or stopping
nuclear energy, it was some cantons who developed different pilot programs

2002
162 PHILIPPINE JOURNAL OF PUBLIC ADMINISTRATION

for saving energy. This was a highly innovative process in which pioneer
cantons with similar preferences were engaged in a cooperative learning
process that prepared consensus on the federal level.

Field IV finally is characterized by weak consensus on both the federal

and the cantonal level. It is a rare case to find policies that are decided on a
weak consensus base on both the national and the cantonal level. But
occasionally, these conditions are met, as with popular initiatives that are
accepted against the political will of national and cantonal elites. This was the
case of the popular initiative for the protection of high moors. Its protagonists
were able to win the double majority in the popular vote in 1987-but not to
raise enough support against vested interests of farmers and tourism in the
implementation process. Thus, policy outcomes are poor or even absent.

Modern Meanings of Swiss Federalism

in a Comparative View

Cultural Autonomy and Difference

The case of Switzerland is instructive for the realization of political unity

while maintaining cultural diversity. The 26 cantons, with their different
cultures, languages and religions, most of them having enjoyed centuries of
political autonomy, were able to create a territorial state. Without federalism
and its principle of dividing power between the new central government and
the cantonal authorities, and without the federal promise to maintain regional
differences and autonomy, this historical process of the 19th century would not
have resulted in a successful nation-building. Moreover, federalism helped to
overcome the strong political cleavages of religion and language in a peaceful
way. While the cleavages of religion between Catholics and Protestants have
cooled, political differences of the four linguistic groups subsist. However, the
political parties, as national parties, want to get votes from all regions and
therefore renounce on ethno-politics. Switzerland is one of the few
multilinguistic countries in Europe that today does not have political
difficulties with linguistic minorities. Federalism was one of the instruments
of political integration. To a large extent, Swiss society is a product of its
political institutions, which led Karl Deutsch to speak of Switzerland as a
"paradigmatic case of political integration."

Federalism as a Political Culture: The Preference

for Decentralized Government and Democracy

Despite some complaints about weak innovation of central government,

the Swiss would never dream of giving up their federalism. They like the

January-October
FEDERALISM IN SWITZERLAND 163

formal autonomy of their 26 cantons and 3,000 communes, which in many

respects may be fictive and to the foreign observer may appear to be an
institutional luxury in a country of just about 7 million inhabitants. Perhaps
it was the federal experience itself that shaped a strong preference for "small
government" and the idea of subsidiarity: Central government should not
meddle in things that the cantons are capable of doing themselves and the
cantons should not bother with problems that the communes can handle.
Subsidiarity can lead to too small solutions, because the lowest federal level
defines what the problem is. However, it offers opportunites for living
differently, and for given regional traditions and additional culture backing.
Thus, it creates local identity.

In the 19th century, federalization and democratization developed hand

in hand. Decentralized democratization was a tremendous opportunity for the
development of civic culture. Local people learned to express their preferences
for public services and goods through direct participation. At the same time
they learned to pay taxes for the collective goods they wanted, and to
distinguish between public and private interest. Trust beyond the circle of the
family is fundamental; it is the base of any effective political institution free
from corruption. Decentralized and responsive government was a favorable
condition for the development of this social capital.

These connotations of a federalist culture go beyond the case of

Switzerland and are meaningful in today's world. In the process of
globalization, two tendencies are seen in politics at a time. The first i~
internationalization through international and supranational organizations,
the second is federalization or decentralization. One of the reasons for
decentralization is the following: Even in a globalized world, people identify
with local societal structures, and they want more political control of the local
world they live in. The process of globalization is a clash between worldwide
penetration through capitalistic enterprises seeking new markets on the one
hand, and subsistent local economies and cultures on the other. The
intermediate structures of government in many developing countries have not,
found solutions for dealing with this inevitable conflict. Above all, young,
democratic regimes, if seduced by short-term chances of centralization, may
fail to combine selective economic modernization with selective backing of
local traditions and cultures. Federal or decentralized political structures can'
help this.

Federalism and the Solution of Multicultural Conflicts

Federalism is often seen as the decisive institutional device that made,

the Swiss miracle of multicultural integration possible. Is federalism
beneficial for the solution of multicultural conflicts beyond the case of'

2002
164 PHILIPPINE JOURNAL OF PUBLICADMINISTRATION

Switzerland? The question is important because the peaceful solution of

multicultural conflicts and the integration of fragmented societies is one of
the most difficult problems in many countries worldwide. To an extent,
conflicts between different ethnic or cultural segments of the same society
have replaced war between nations. Faced with this problem, only few
democracies perform well. The political scientist Arend Lijphart (1999), in his
seminal work on power sharing, insists that consensus democracy is superior
to the majoritarian model of Westminster democracy when it comes to the
solution of conflicts in culturally divided societies.

With regard to federalism-which can be seen as the vertical element of

power sharing or consensus democracy-other theorists are not so sure as to
its good effects on the solution of multicultural or minority conflicts. They
argue that:

• federalism protects only geographically segmented minorities

that are able to control a subnational unit, which can lead to a
new minority problem in this unit;

• creating subnational units for cultural minorities can lead to

the separation of this minority as in Bosnia, and to a
discriminating control through the majority;

• federal systems of segmented societies with few national

units-such as Belgium or the former Czechoslovakia-are
unstable.

The first argument is also valid for the Swiss case. Many minorities-the
non-Christian religions, or the foreigners which account for 20 percent of the
Swiss population-were never protected by Swiss federalism.' Moreover,
federalism protects the Swiss linguistic minorities only at the national level,
where the authorities accept the four languages of German, French, Italian
and Romansch as equal. A German speaker in the canton of Geneva, however,
has no minority rights and therefore has to address the authorities in French.
Thus, federalism is a rather incomplete instrument to protect minorities.

But why has Swiss federalism escaped the risks mentioned in the other
arguments? In the Swiss case, according to Steiner (1990), three factors which
are generally favorable to minority protection in federal systems can be found.

1) Linguistic, ethnic and religious segmentation, until recently, was

characterized by not too many, and not too small minorities.

2) Economic, religious and linguistic fragmentation of the cantonal

'societies did not coincide socially or geographically. Some German-

January-October
 FEDERALISM IN SWITZERLAND 165

speaking cantons, for instance, are .mainly Catholic, some

Protestant. There was only one case, the region of Jura, which was
poor, French speaking and Catholic, and which felt discriminated
mainly by Protestant, German speaking and rich canton of Bern.
Here, three cleavages coincided socially and geographically, This
explains why Jura is the sole case of secession in the Swiss
federation. After long political struggles, Jura became an
autonomous canton in 1978.

3) In many cantons, there is no clear geographical separation of

religious or cultural groups. We find four bi- or multi-lingual
cantons and, with regard to religion, all of them are mixed. Under
these circumstances, the federal structure was beneficial for
coexistence and learning processes between the different religious
and cultural groups. This was important for the people and for', the
political elite as well. A radical French-speaking politician in 'the
canton of Valais is in a minority position in question of party
politics but belongs to the linguistic majority of his canton. As a
member of the National Council, however, the same politician is in
a linguistic minority position, but normally forms part of the
bourgeois majority. Thus, the members of the political elite have to
learn both the minority and the majority roles. Cooperative
federalism implies a constant process of negotiation. As coalitions
change from one question to the other, the different actors need and
have to accept and to recognize each other. This favors learning
processes and win-win solutions. These effects are not confined to a
particular cultural heritage of the Swiss but the effect of all
institutional setting that can be expected also in other cultural
contexts.

Conclusions

It can be concluded from the Swiss case that federalism can indeed be
favorable to peaceful solutions of multicultural conflicts, but only under
certain circumstances.

This implies us to be cautious about "exporting" institutional models

r
from one society to another. Swiss democracy, as well as federalism, are not
export products like watches or other utilities. Effective and legitimate
political institutions must grow on a people's own cultural heritage, and they
must combine tradition and modernization in a selective and intelligent way .
... Yet, other societies can learn from the historical experience of others.
The Swiss case illustrates that federalism must not be destructive for national

2002
166 PHILIPPINE JOURNAL OF PUBLICADMINISTRATION

unity but quite the opposite: federalism allowed the nation-building through
political integration of a segmented and deeply divided society. Moreover,the
Swiss case illustrates that federalism can be beneficial since the times of
industrial take-off in the 19th century up to the present. In earlier times, it
allowed the development of a sound civic culture in decentralized, autonomous
subnational units. In today's globalization, where the nation state seems to be
either too large or ,too small, federalism can bridge the gap. Finally,
federalism was an instrument of political power sharing that allowed the
Swiss to resolve their multicultural conflicts in a peaceful way.

But besides this historical experience, what can other countries learn for
the design of their own polity? For a good answer, one has to look at a
comparative research that focuses on "regularities" of the effects of
institutions. As to the effects of federalism on the solution of multicultural
conflicts, the following table lists "good" and "poor" conditions of federalism or
decentralization.

Table 4. Governance in Segmented Societies: Poor and Good

Conditions of Decentralization and Federalization

Conditions Leading to: Poor Cases Good Cases

Distribution of minorities Dispersed in all sub- Concentrated in one or

national units more subnational unit

Number and size of Many small, especially in Not too few, not too
minorities presence of one large many
majority

Cleavages in subnational Congruent Cross-cutting

units

Exterior intervention Present Absent

Definition of nation (Mono-) cultural Citizenship

Tradition of fundamental Weak Strong

1
rights

Combination of vertical No Yes

and horizontal power
sharing

Source: Linder 2002: 18.

January-October
FEDERALISM IN SWITZERLAND 167

The first three conditions correspond to the factors discussed as

beneficial in the Swiss case. The next condition is derived from comparative
experience. In the past, exterior intervention, especially from neighbors,
proved to bear more risks than chances for the solution of inner societal
conflict. The next two conditions, "Definition of nation" and "Tradition of
fundamental rights," are evident. Federalism alone is an imperfect device for
the solution of multicultural conflicts, in particular, minority protection is
better off if guaranteed through fundamental rights and if the conception of
the nation state does not discriminate against citizens of different origin arid
culture. The last condition is derived from Lijphart's theory-power sharing
democracy is better suited for a segmented society than the anglosaxon model
of Westminster democracy which concentrates all power in the hands of the
ruling majority. Federalism, the vertical dimension of political power
sharing, is more effective for the solution of multicultural conflicts if it 'is
complemented by the horizontal dimension-that is, proportional
representation and compromise among grand coalitions of the political
parties.

These institutional conditions are not natural laws. They do not

guarantee good solutions of multicultural conflicts but give them a better
chance. To conclude, the effects of federalism do not depend only on the
political culture of a country which is unique, but also on the combination of
federalism with other institutional elements.

References
Frenkel, Max
1986 Interkantonale Institutionen und Politikbereiche. In Raimund E. Germann
und Ernest Weibel, Hg. Handbuch Politisches System der Schureiz.
Foderalismus. Bd. 3. Bern, Haupt: 323-342.
Germann, Raimund E.
1991 Die Europatauglichkeit der direktdemokratischen Institutionen der Schweiz,
Schweizerisches Jahrbuch far Politische Wissenschaft 31: 257-269.
1986 Die Beziehungen zwischen Bund und Kantonen im Verwaltungsbereich. In
Raimund E. Germann und Ernest Weibel, Hg. Handbuch Politisches System
der Schweiz. Fcderalismus. Bd. 3. Bern, Haupt: 343-367.
1981 Ausserparlamentarische Kommissionen: Die Milizuerwaltung des Bundes,
Bern und Stuttgart: Haupt.

Heger, Matthias
1990 Deutscher Bundesrat und Schweizer Standerat: Gedanken zu ihrer
Etitstehung, ihrem aktuellen Erscheinungsbild und ihrer Rechtfertigung.
Beitriige zum Parlamentsrecht, Bd. 17, Berlin: Duncker und Humblot.

Jaag, Tobias
1976 Die Zweite Kammer im Bundesstaat: Funktion und Stellung des
schweizerischen Standerates, des deutschen Bundesratee und des
amerikanischen Senats. Zurich: Schulthess.

2002
168 PHILIPPINE JOURNAL OF PUBLIC ADMINISTRATION

Kloti, Ulrich
1988 Political Ideals, Financial Interests and Intergovernmental Relations: New
Aspects of Swiss Federalism. Government and Opposition 1 (23): 91-102.

Lijphart, Arend
1999 Patterns of Democracy. Government Forms and Performance in Thirty-Six
Countries. New HavenILondon: Yale University Press.

Linder, Wolf
2002 Political Challenges of Decentralisation. Typoscript. Bern: Institute of
Political Science.

1999a Verfassung als politischer Prozess. In: Sitter-Liver, Beat: Herausgeforderte

Verfassung. Freiburg: Universitatsverlag.

1999b Schweizerische Demokratie. lnstitutioneti - Prozesse - Perspektiven. Bern/

Stuttgart. Haupt.

1987 Politische Entscheidung und Gesetzesvollzug. Bern/Stuttgart: Haupt.

1994 Swiss Democracy. Possible Solutions to Conflict in Multicultural Societies.

London: St. Macmillan.

Linder, Wolf/Adrian Vatter

2001 Institutions and Outcomes of Swiss Federalism: The Role of the Cantons in
Swiss Politics. In Jan Erik Lane, ed. The Swiss Labyrinth. Institutions,
Outcomes and Redesign. London: Frank Casso

Luethi, Ruth
1999 Das Parlament. In Ulrich Kloti, Peter Knoepfel, Hanspeter Kriesi, Wolf
Linder, Yannis Papadopoulos, Hg. Handbuch der Schweizer Politik. Zurich:
NZZ-Verlag: 131-158.

Lutz, Georg and Dirk Strohmann

1998 Wahl- und Abstimmungsrecht in den Kantonen. Bern/StuttgartlWien: Haupt.

March, James and Johan Olsen

1996 Institutional Perspectives on Political Institutions. Governance 9: 247-264.

Munger, Bernhard
1994 Die Konferenz der Kantonsregierungen. In Dieter Freiburghaus, Hg. Die
Kantone und Europa. Bern, Haupt: 247-263.

Neidhart, Leonhard
1975 Foderalismus in der Schweiz. Zurich/Kola: Benziger.

Nussli, Kurt
1985 Foderalismus in der Schweiz. Konzepte, Indikatoren, Daten. Grusch: Ruegger.

Obinger, Herbert
1998 Federalism, Direct Democracy, and Welfare State Development in
Switzerland. Journal of Public Policy 18 (3): 241-263.

Papadopoulos, Yannis
1997 Les processus de decision federoux en Suisse. Paris: L'Harmattan.

January-October
FEDERALISM IN SWITZERLAND 169

Peter
1991 Ftideralistischer Aufgabenverbund in der Schweiz. Bern: Haupt.

Steiner, Juerg
1990 Power Sharing-Another Swiss Export-Product? In Joseph V. Montville, ed.
Conflict and Peacemaking in Multiethnic Societies. Toronto: Lexington.

Trivelli, Laurent
1975 Le bicameralisme: Institutions eomparees: Etude historique, statistique et
critique des rapports entre le Conseil National et le Conseil des Etat.
Lausanne: Payot.

Tsebelis, George
1995 Decision Making in Political Systems: Veto Players in Presidentialism,
Parliamentarism, Multicameralism and Multipartism. British Journal of
Political Science 25: 289-325.

Vatter, Adrian
1999 Foderalismus. In Ulrich xieu, Peter Knoepfel, Hanspeter Kriesl, Wolf
Linder, Yannis Papadopoulos, Hg. Handbuch der Schweizer Politik. . Zurich:
NZZ-Verlag: 77-108.

Vatter, Adrian and Fritz Sager

1996 Foderaliamusreform am Beispiel des Standemehrs. Schuieizerische Zeitechrift
fUr politische Wissenschaft, 2/2: 165-200.

Wili, Hans-Drs
1988 Kollektive Mitwirkungsrechte von Gliedstaaten in der Schuieiz und im
Ausland: Geschichtlicher Werdegang, Rechtsvergleichung, Zuku,nfts-
perspektiven. Eine institutsbezogene Studie. Bern, Stampfli.

2002