How should governing institutions be designed for large, sprawling systems, such as global companies or international organizations? How can governments and institutions facing global problems provide enough autonomy for smaller units to flourish while at the same time achieve economies of scale from coordination? Federation offers a promising, and common, answer to such questions. An allegedly successful model for governance, federation can survive in form and it can lead to productivity, profitability, safety, stability, enrichment, or whatever we want from our institutions. Federation offers the opportunity to combine diversity and unity. It is the “politically correct” form of governance. Celebrate difference, individuality, voice, but also recognize and harness unity of purpose, oneness, and overlapping interests. What is not to like in principle about the idea of federation?

The separation of power between an executive and a representative body serves as another common institutional feature among organizations and governments. Under this typical institutional form, the organization or government will have shared decision-making authority between a council, parliament, congress, or central committee made up of representatives of various subunits, and an executive whose authority is derived independently of the representative body. The representative body can include members from various constituencies, who are often grouped by geographic origin. The representative body is not solely responsible for choosing the executive, and the executive is not solely accountable to the representative body, but also to such other groups as voters, investors, or outside evaluators. Perhaps, as is the case with the U.S. government, the executive and the representative bodies check each other and typically must assent to the passage of new laws. That is, both have a veto over new policies.