Dropped by the Mudcat, and couldn't resist this thread. The reason the Feds are making that argument is because the commerce clause of the US Constitution prohibits them from exerting power in matters unrelated to interstate commerce. In other words, if it's unrelated to interstate commerce, it's a state's rights issue, and the Feds have to butt out.

I'm not a lawyer; if I were, I could give a better explanation of how the commerce clause works. But as I understand it, that's the crux of the Feds' argument, because if they don't win on that issue, they're out of luck.