One of the bedrocks of our governmental infrastructure is federalism. This is the constitutional recognition of the legal origins of the United States as a union of independent states. America started, of course, with 13 colonies, which became 13 states, and gradually added 37 additional states.

Though the federal government is a behemoth today, it was created when each of those states ceded some of their sovereignty to the federal government. They did this in writing. The writing is the Constitution, and it explicitly states that the governmental powers not ceded are retained by the states.

President Reagan reminded us of the origins of the country in his first inaugural address when he stated, "All of us need to be reminded that the federal government did not create the states; the states created the federal government." He also said that the beauty of the retention of powers by the states is that they are likely to exercise those powers differently and become laboratories of democracy—hence, Reagan's famous quip that one of the benefits of living in the U.S. is federalism, because "you can vote with your feet."

So, if you don't like the over-regulated Massachusetts, you can move to New Hampshire, and if you don't like the over-taxed New Jersey, you can move to Pennsylvania. This is easier said than done, but the principle subsists, and as long as we have not surrendered the freedom to travel, we can still move to more freedom-friendly states.

This is not an academic theory; it has real-world consequences for my Fox News colleague Jana Winter. Jana is an investigative reporter for foxnews.com. Like all good folks on her end of journalism, Jana has developed sources. In the course of investigating the July 20, 2012, slaughter in a movie theater in Aurora, Colo., Jana learned from sources to whom she promised confidentiality that the alleged murderer, James Holmes, sent a notebook to his treating psychiatrist at the University of Colorado, a state-owned school. This information was earth-shattering for the Holmes case because it triggered the argument that a government psychiatrist ought to have known of Holmes' violent ideations a week before he allegedly carried them out in a movie theater.

At the time Jana learned and reported about the Holmes notebook, all witnesses in the Holmes case were under a court order not to speak with anyone, least of all reporters. When Holmes' lawyers learned that Jana reported on the notebook, they subpoenaed her notes, and lawyers for Fox moved to quash the subpoena. Fox's lawyers argued that her sources were protected by a Colorado shield law. That law compels lawyers who are seeking the names of reporters' confidential sources to seek them elsewhere before approaching the reporter. That law also permits the incarceration of reporters who decline to obey any court order compelling the production of the names of their sources.

Holmes' lawyers apparently want the names of Jana's sources because they believe them to be law enforcement personnel who violated the gag order. Criminal defense lawyers can have a field day on cross examination of cops when they have caught the cops breaking a law they have sworn to uphold. On the other hand, the press, which is the eyes and ears of individuals, a role it enjoys under the First Amendment as interpreted by numerous Supreme Court cases, would be fruitless if reporters could not promise confidentiality to sources. This goes back to the Pentagon Papers case in which the Supreme Court held that matters of material public interest in the hands of reporters—no matter how acquired—may "freely" be published. Freely means free from government retribution.

Here is where federalism enters the picture. Jana lives and works in New York. She was ordered by a state judge in Colorado to reveal her sources and threatened with incarceration. New York law does not permit incarceration for failure to reveal sources. So, Fox's legal team filed an application in a New York state court to block the order of the Colorado state judge. That application was denied by a trial judge, and that denial was upheld by an appeals panel by a 3-to-2 vote, and earlier this week, the case was argued before New York's highest state court, the Court of Appeals.

This should be a no-brainer. Jana voted with her feet and chose to live and work in the most First Amendment-friendly state in the union. She should be protected by New York law. If she is not, then all reporters will lose their confidential sources, and all Americans will be in the dark when whistleblowers know awful truths but are unwilling to pay the price of public revelation.

In this era of the Internet, all information is available everywhere all the time. Just because the information in the Holmes case was about an event in Colorado does not mean that Colorado law should control the fate of a New York reporter. The controlling factor should be freedom: the freedom of sources to reveal truths, the freedom of reporters to publish truths, and the freedom of sources and reporters from government retribution.

There is always a common theme in these reporter sources cases, and Jana's is no different. Invariably, the awful truth is about a failure of government—in this case a government psychiatrist. The government hates and fears the truth. Yet, if the government could control the flow of news, it would only tell us what makes it look good, and we would lack the knowledge with which to make prudent judgment about its policies. Thomas Jefferson once remarked that he'd prefer newspapers without government to government without newspapers.

A proper application of federalism could save the values of the First Amendment and the freedom of Jana Winter. If not, we face the ancient spectacle of a courageous reporter being jailed not for committing a crime, but for telling a truth. And the confidential sources will dry up, and the whistleblowers will clam up, and the government will control more of our lives.