Federalism refers to the division of power between state governments and the central, federal government in the United States. It affects policymaking in many ways. One is that there are specific powers held only by states. These include licensing, some powers related to education, and others. What this means is that states are free, within constitutional parameters, to develop their own policies to deal with these issues. The fact that the federal government, according to the United States Constitution, is supreme means that states cannot make laws that supersede federal legislation.

Federalism in practice looks considerably different than federalism in theory. In practice, the importance of federal funding means that the threat of withholding such funding can give the federal government tremendous power over states. Federal education legislation, for example, is enforceable because if states choose to disregard it they forfeit federal funding for education. Thus the federal government has been able to develop guidelines for states, even though such guidelines essentially fall within the purview of states. This is how many federal policies are implemented. Still, many policies are enacted at the state level. Some federal policies give greater autonomy to states, who share in the responsibility for their implantation.

States still retain a considerable amount of autonomy, however, and every policy enacted involves, in a sense, a debate over federal power. We currently see this feature of federalism in play in the decisions of federal governors to "open up" amid the COVID-19 crisis. The federal government can give guidance, but ultimately the decision to relax "stay at home orders" belongs to the states. For this reason, different states have different requirements.