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The chief distortion in the federal system now is that there is essentially no check on the Federal Government’s tendency to arrogate the states’ reserved authority. This is not the fault of the Constitution’s authors and ratifiers, but of the people who adopted the 17th Amendment in 1913.
Besides that, it was thought that requiring officials to take an oath to uphold the Constitution would restrain them. In those days, oaths’ religious significance was taken far, far more seriously. For more on the religious scruples of the Founding Fathers, I highly recommend Mark David Hall’s recent biography of Roger Sherman, which I reviewed very positively for an upcoming issue of The American Conservative.
No, people did not foresee the advent of a two-party system. They responded to it with the 12th Amendment, but of course merely averting another Electoral College tie for president in the wake of the election of 1800 did not solve the entire issue: the impeachment power, for example, is essentially useless as a means of Congress policing the other branches’ adherence to the Constitution now that we have parties.
I have proposed an Article V Convention to amend the Constitution as a means of restoring the federal principle. One mechanism to serve the purpose of the old means of electing senators would be empowering a majority of state legislatures to counteract federal courts’ constitutional decisions–not in the case at hand, but as a matter of precedent. Another would be an imitation of the Council of Censors established by the Pennsylvania Constitution of 1776, this time again made up of state legislators.
The underlying problem, of course, is the extension of the suffrage, which drastically reduced the educational level of the electorate. I cannot imagine any way of counteracting that development.