federalism

n. form of government in which separate states unite under a central authority while retaining limited powers of government; principles of the Federalist party

Political federalism is a political philosophy in which a group of members who are are bound together (Latin: foedus, covenant) with a governing representative head. The term federalism is also used to describe a system of the  government in which sovereignty is constitutionally divided between a central governing authority and constituent political units (like states or provinces). Federalism is the system in which the power to govern is shared between the national & state governments, creating what is often called a federation. Proponents are often called federalists.
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Broadly speaking, this means any system of government where several states form a unity and yet remain independent in their internal affairs. People who are in favour of this system are often called "federalists".
A number of countries around the world - e.g. Australia, Canada, Germany, Switzerland and the United States - have federal models of government, in which some matters (such as foreign policy) are decided at the federal level while others are decided by the individual states. However, the model differs from one country to another.
The European Union is not based on any of these models: it is not a federation but a unique form of union in which the member states remain independent and sovereign nations while pooling their sovereignty in many areas of common interest. This gives them a collective strength and influence on the world stage than none of them could have on their own.
Part of the debate about the future of Europe is the question of whether the EU should or should not become more "federal".

Noun
1. the idea of a federal organization of more or less self-governing units
(hypernym) political orientation, ideology, political theory

federalism