The Federation sees itself as the center of the galaxy, and more importantly, the center of humanity. Its capital system, Sol, is the birthplace of humanity. It prides itself on its democracy, freedom of speech and the high level of living standards for its citizens.
Both versions are more or less true. Although the Federation has a strong navy, and promotes patriotism to drive its peoples (as opposed to genetics or internal repression (See Empire)) it suffers the fate of all large, hierarchical empires, which include corruption, state secrecy and the triumph of wealth over justice. Whilst not unique to the Federation, they still represent a challenge to its idealized self-image.
The Federation's attitude to the Empire is of implacable opposition, as the Empire represents opposition to all the Federation's ideas. The less charitable also note that the Federation psyche has not yet got over the insult of the original Achenari "insurgency" many hundreds of years ago. The two powers are locked in an almost constant state of Cold War, with occasional flare-ups of armed hostility. This spills over into many areas of Federation cultural and political life, which leads to significant distortions of public life and policy.
The attitude to the Alliance is considerably more ambivalent. Despite the fact that the Alliance was formed as an attempt to resist both Imperial and Federation dominance, the relationship between the two can be described as more or less friendly rivalry, which has not spiraled into direct conflict yet, although the increasing clout of the new and relatively uncorrupted power has provided significant areas of tension and border incidents.
Independent worlds have generally been safe from Federal conquest, if only for the reasons that such activity would quickly attract the Imperial and Alliance war fleets. Whilst the Federation would not object (per se) to their addition to the list of aligned worlds, the Federation is generally too big and too politically inert to take any actions to bring this about.
The Federation boasts the most powerful fleet in the known Galaxy, on par with the Imperial War Machine. Based out of Eta Cassiopeia, the Federation Navy Centre, the navy's fleets patrol human space, engaging in border clashes with both the Empire and the Alliance, as well as peace keeping missions in systems of civil war or disputed systems.
Sphere of Influence
The Federation borders stretch from Beta Hydri in the 'South', bordering the Imperial Systems, up to Eta Cassiopeia and the Federation/Alliance border in the 'North'. Systems of note within the Federation borders include Delta Pavonis, Tau Ceti and the "homeworlds" including Sol and the industrial center of Barnards Star. Several systems not within the immediate vicinity of Earth nonetheless swear allegiance to the Federation Government. Examples include Tiliala [-4,-1] and Quiness [-8,6]
There are also several systems within the Federation border which do not swear allegiance to the Federation, but remain independent, retaining sovereignty and their own laws. These range from religious enclaves like the van Maanens Star, to communist worlds like YZ Canis Minoris to corporate systems such as the Sirius system (Home to Sirius Corp, the biggest manufacturer of military fuel in the galaxy). Whilst the influence of the Federation is not absolute within it's borders, the powerful navy and almost-as-powerful Federal bureaucracy ensure that violent insurrection is almost unknown.
The Federation was formed as a response to the attempts at genocide on Tau Ceti 3 in the 2240s, this was suppressed by the newly formed political entity, which spread its influence throughout known space. The success of the rebellion on Achenar only served to strengthen the political unity of the Federation, as well as give it a distinctly bellicose character.
Since that time, the Federation and the Empire had been in a state of perpetual Cold War, only interrupted once in 900 years. It was during the 3000's that humanity made contact with another intelligent life form. Unfortunately, this contact came in the form of an unprovoked attack on the alien ship, resulting in a long and costly war with the technologically superior insectoid species, known as the Thargoids.
Joining forces with its old enemy, the Empire, The Inter-Galactic Navy Research Arm, or INRA was formed. INRA was involved in finding ways to combat the Thargoid menace through both military and non military means. The joint operations served to forge together
After the end of the Thargoid War (later renamed the War of Mutual Misunderstanding, after contact with the aliens was reestablished) INRA disappeared into the darkness of myth, and the Federation returned to its cold war with the Empire.
This cold war was fundamentally changed when the Alliance was formed, during an otherwise routine conflict over the ownership of Alioth between Federal and Imperial war fleets. The repulsion of both forces by the natives of Alioth was a severe black-eye to the Federation, although the Alliance would prove to be as implacable a foe of the Empire as the Federation itself was. Once equilibrium was reached between the powers, the Federation was sandwiched between the traditional rival of the Achenari empire and the new rival on its northern frontier. To an extent, this has produced a siege mentality, although relationships with both remain "neutral".