The Covid crisis has affected Commonwealth-state relations more profoundly than at any time since the Commonwealth grabbed the totality of income-tax power in World War II. This time, however, the power is moving the other way, from the Commonwealth to the states. And Prime Minister Scott Morrison, who is being pulled and pushed in different directions by different power centres, has little idea how to deal with it.

There is no Gough Whitlam, Malcolm Fraser, Bob Hawke and Paul Keating, or John Howard pulling the nation together and setting a national agenda to deal with the major challenges that those Prime Ministers did - such as (in order) Vietnam fallout and policy stagnation; chaotic government; an isolated and closed economy; and gun control.

Morrison's response to a crisis is not to take control and lead, but to let others do the heavy lifting and have them take the blame when things go wrong. He seems almost frightened of his donors, his junior Coalition partner, polls, and the voters. So, he does not take charge.

The states have been happy to move into the power vacuum, and will not be easily moved back when Covid is over.

Part of the erosion of federal authority can be put down to Morrison's character, exemplified by his dithering over the treatment of women at Parliament House. But there is perhaps another more important reason: a general lowering of ethical standards in the federal sphere coinciding with an improvement in ethical standards at the state level.

The states have now all instituted anti-corruption bodies. Ministers at the state level have lost their jobs and even been jailed. That message has been received, and ministerial conduct improved.

But at the federal level, which for a long time was thought not to have any corruption warranting an enforcement body, ethical standards have been slowly getting worse.

The car parks scandal was the most recent. Ministers signed off and approved, just before the 2019 election, spending of public money on car parks, ostensibly to reduce congestion, but, as the Audit Office found, to pour money into projects in marginal electorates for short-term political advantage.

Then, having been caught out, government ministers dissembled verging on lying. They argued it was normal democratic practice to promise to do things, get elected and do them.

But the car park spending had all been approved before the election. It was a fait accompli, not a promise to do something in the future if elected. The justification for the rort was utterly untenable.

That scandal accompanied a litany of Audit Office exposures of ministers directing large amounts of public money to Liberal Party donors without competitive tendering and proper processes.

When a government engages in that sort of corruption, trust goes out the window and with it, authority.

The federal government had (and still has) the power to take over the whole of the Covid response under its constitutional quarantine power.

True, the states are sovereign and have powers to act, but only to the extent that their actions are not inconsistent with federal law. So, if the federal government had imposed national lockdowns, the states could impose tighter lockdowns, but not looser ones.

As it happens, the federal government did not take control and impose national lockdowns. So, the states stepped in.

They have also stepped in on climate change. They have all pledged emissions targets stronger than what little the federal government has done.

Again, the cost has been to federal authority.

And this week, NSW stepped in on perhaps one of the most fractious divergences of federal-state interests: population policy.

NSW Planning Minister Rob Stokes called for a national policy on population and people: "how many we can expect, where we want them to live and what their needs and attributes might be."

The federal government sets immigration quotas and policies. Since the Howard government ramped up immigration levels in the early 2000s at the behest of business (especially property developers, retailers, and big agriculture) which wanted cheap labour and more customers, it has put impossible strains on the states which have had to provide the infrastructure and services.

This is aside, of course, from the environmental strain of high immigration.

Stokes is signalling that the states, at least NSW, have had enough. NSW and Victoria cop the biggest strain because migrants flock to Sydney and Melbourne.

So do not be surprised if the states do not accept post-Covid the high-immigration rate that pertained before Covid. The states understand population pressure on services now more than ever before.

The states are still sovereign. They can do things to stop the immigration burden. An example would be for Stokes in NSW to impose an infrastructure tax on all property holders (including the principal residences) in proportion to the number of immigrants the feds allow in.

It makes sense. Property values go up with high immigration while amenity of life goes down (congestion, environmental destruction, strains on services etc). So, the property holders should pay. And the states, which bear the infrastructure burden should make them.

More Australians are realising that with immigration down to next to nothing, there have been a lot of benefits. Unemployment has gone down and wages gone up, despite all the misguided predictions of the pro-growth, pro-high-immigration economists.

The great majority of Australians (Covid aside) are better off, despite the whinges of retail and big agriculture that Australia needs to import more cheap labour (though put more subtly than that).

Covid has changed the balance of Federal-state power. Does it matter? In the 1970s and 1980s, progressives generally detested the states and thought they should be abolished because they hindered national progress.

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Now, however, most of the states are doing better than the feds on Covid, climate, population, and the environment. They are revealing the feds' and Morrison's inadequacies.

But that is not enough. Morrison should be leading on these existential threats.

If he wanted to lead like those other prime ministers, he should acknowledge the popular call for effective action on climate and Covid and institute an integrity regime that would free him from the shackles of his donors and enable him to have a sensible population policy.

In other words, stare down the narrow, misogynist, selfishness of the National Party and the right-wing of his own party and move fearlessly to the sensible centre. There would be nothing to lose. Where else are the ratbags going to go?

Hey, Scotty from Marketing, lead. Curb the erosion of federal authority for the right reasons in the right way.

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