WHEN a shifting and flexible interplay of the lights and shadows of understanding is called for between the federal and state governments, informality in cooperation is of the essence. In such a situation, each new cooperative activity calls for a new plan or a quickly changed emphasis on the old one. But when clarity and definiteness are needed or when the conditions of cooperation remain fixed for at least a period of time, something more than mere temporary understanding is necessary. In cases in which conditions and terms must be decided upon and adhered to by both governments, understanding becomes solidified into agreements, which may be written or unwritten. Finally, if the problem to be handled necessitates a permanent and binding contract, the stage of compact or formal agreement is reached. There is obviously a wide gulf between the simplicity of even an expressed understanding between federal and state officials and the constitutionally intrenched fastnesses of a formally conducted compact.
The power of the two governments to enter even legally binding agreements or compacts with each other is indisputable so long as the states do not thereby impair the somewhat intangible "essence of statehood."1 Such agreements2 exist with all degrees____________________
See also separate dissent of Mr. Justice Sutherland in Chas. C. Steward Mach. Co. v. Davis, 57 S. Ct. 883, 901 ( 1937): "Nor do I doubt the authority of the federal government and a state government to cooperate to a common end, provided each of them is authorized to reach it. But such cooperation must be effectuated by an exercise of the powers which they severally possess, and not by an exercise, through invasion or surrender, by one of them of the governmental power of the other."
The federal government, however, may not constitutionally make contracts with individuals regulating agricultural production. United States v. Butler, 297 U.S. ( 1936). See below, pp. 165, 288-89.