This topic comes up from time to time, and it has always fascinated me. In its early history, the USA was quite literally a rather loose confederation of states. This system, under the Articles of Confederation, proved to be less than ideal for a number of reasons. There is a lot of debate about these reasons, and the main ones were (essentially): that there was no national executive (there was no president or government at all, just the Congress); that the Congress relied on donations from the states to finance itself; that the states occasionally did such things as raise tarriffs between themselves; and that several states had paid off their ARW-related debts, whereas other states had done no such thing, which lead to economic troubles (see: Shays Rebellion).
Now, in OTL, this was all ultimately resolved via the Constitution. And very often have I seen threads that ask question such as "WI the Constitutional Convention fails? Does the USA balkanise?" -- and my response to that is: no way. The Constitution was an ambitious, daring, and even brilliant project, designed to not only resolve the flaws mentioned above, but to set up a manner of republican national government never before seen on earth. If this had proved to be impossible... the less ambitious step of simply amending the Articles would have been taken. There would still be a USA, but it would be wildly different from the "Constitutional" USA that we know in OTL.
It is such a different USA that I'd like to discuss here. And I frankly admit that I'm doing this with a somewhat nebulous TL idea in the back of my head, where due to certain reasons, a constitution never even comes up, and a (somewhat) drastic revision of the Articles is instead undertaken. (Not to spoil too much of a TL I might actually write later on, but among other things... Washington and Hamilton are both dead, and Madison is minister to France. You might see why things are different, then.)
In any case, given the scenario I have in mind, I have come up with a list of alterations to the Articles (included below). Please note that several of these are not likely to have come about in OTL, but my premise assures that things are different in the ATL. So I beg all of you, for the sweet love of God... do not start a discussion about how (un)likely you consider any or all of these points are. That kind of debate, while very useful in other contexts, is not my goal here.
My goal here is merely to ask: given an alt-USA that remains confederal, that basically deals with the fundamental problems of the original Articles, but is explicitly decentralised... how does this USA develop?
Given the fact that the states remain essentially autonomous, and that the national government has almost no domestic functions, how institutionally diverse are the various states going to be? State politics will likely be dominant. Is it conceivable that there are no national parties, but state parties that are nationally grouped into vague factions (much like European national parties grouped into Europarliament factions)? With a (con)federal govenment that has no power to even come close to abolishing slavery, is it conceivable hat northern states eventually get fed up and secede? (If so, do they do this en masse, forming a northern federation? I kind of think that, with such a thing happening later, the resulting northern entity might be more centralised - and in that regard more like OTL - but would still be unexpectedly different from the USA we know.)
Anyway, I'm kind of mulling this all over, and I figured I'd better put it all down here on the board, so others can add their insights to it.
In any case, below are the alterations to the Articles that I have in mind. Please note that these come about roughly at the same time the constitution did in OTL, that there is support for this course of action in this ATL, and that I am aware of the fact that there are serious flaws in the resulting revision (my goal, after all, is not to create some kind of idealised states' rights utopia, but a depiction of what a confederal, decentralised USA might actually be like).
THE LIST:
— Congress attains the authority to maintain a navy and a standing army. States are explicitly forbidden to maintain navies of their own, although any kind of coast guard remains purely a state affair. On the other hand, the size of the national army is limited in the Articles, and the use of the army and/or navy against US citizens is forbidden under all circumstances.
— Congress is exclusively charged with all tasks pertaining to foreign affairs, the national army and navy, the management of US territories, the maintanance of the national treasury, and the arbitration of any legal conflict between two or more US states (in which case Congress will be authorised to issue a binding verdict). Congress gains no other tasks than these, and it is in fact explicitly determined that all other matters are issues for the individual states.
— Congress remains unicameral, and every state retains one single vote, regardless of size/poulations/etc. (States can choose to send one representative, or a delegation; states can give their delegates binding instructions, or leave them free to vote as they see fit; they can have delegates elected, or appoint them— all of this is left to the states individually.)
— There is a President of the United States who wield executive power. He is elected for four years via a first-past-the-post district-based system: whoever wins most districts wins the election. (The Articles dictate that all districts hold roughly the same amount of voters).
— In the context of elections... each state decides for itself who gets to vote. In certain states, all freemen get to vote. In others... not so much.
— The President heads a cabinet, supported by a very modest bureacracy. The Articles explicitly (and exhaustively) lists the cabinet positions: a Secretary of War, a Secretary of the Navy, a Secretary of State, a Secretary of the Treasury and a Secretary of the Interior. All these are appointed by the President.
— Congress (and thus the government) is to be financed via a univeral tarriff levied on all imports. The tarriff is explicitly defined as a percentage of the value of the goods being imported. Congress cannot raise the percentage without ratification by at least two thirds of the state legislatures. On the other hand, states are forbidden to levy any kind of tarriffs of their own. There will be one tarriff, it will be national, and it will not disciminate to the benefit or detriment of particular goods. Finally... Congress is forbidden to ever raise any other kind of tax or levy besides the national tarriff.
— Regarding the issue of war: Congress maintains the national army and navy, the President is Command-in-Chief, and a declaration of war demands a majority in Congress, ratification by a majority of state legislatures, and the assent of the President.
— Regarding the national treasury: this is the only institution allowed to mint the national currency (the US Dollar). In keeping with the spirit of the times, and with drastic wartime inflation in recent memory, it is dictated in the Articles that the Dollar must be fully backed by gold. (The Articles state that the Dollar is legal tender that must be accepted as currency throughout the USA... but it does not state that states and private parties are forbidsden from using their own secondary currencies besides the Dollar.)
— Congress is only allowed to run a deficit and build up a national debt during wartime. It is stipulated that any such wartime debt must be paid off as soon as can be managed after the war’s end.
— States are not allowed to run a deficit or to build up a public debt under any circumstances. In fact, unlike OTL, the national government does not assume the remaining state debts, and states still in debt are instructed to make haste in paying them off.
— Seperate associations of US states (such as a "union within the union") are explicitly forbidden, except with the express permission of Congress, in which cases such permission can also be retracted afterwards.
— States are explicitly forbidden from raising any obstacles to interstate commerce, except to prevent the importation of goods that are illegal in one state and legal in another. Any form of interstate taxation of trade is universally forbidden. (And notably, the clase states that “...interstate commerce shall be free and unhindered”. Congress receives no power to regulate interstate commerce in any way.)
— Finally, the issue of secession is explicitly tackled: a state legislature must agree to it with a two thirds majority (in both houses if it’s a bicameral legislature) and after that, a (regular majority) pleibiscite must confirm the decision.
...at the risk of repeating myself (but simply because I know how these threads can derail) I stress once more that I'm not asking people to debate whether these changes are likely. Many are highly implausible under OTL circumstances, but I am asking you to accept that we are dealing with suitable ATL circumstances here.