States Try New Approaches, Federal Cool

Over the last two years, while the federal government has focused on terrorism and the war in Iraq, governors and state legislators have been tackling pressing domestic policy issues ranging from soaring prescription drug prices to environmental concerns.

“There is tremendous innovation going on in state legislatures today. With Congress gridlocked, a lot of the innovation in public policy is coming from the states,” said Gene Rose, director of public affairs for the National Conference of State Legislatures (NCSL).

According to the NCSL, 17 states have raised the minimum wage above the national level of $5.15 per hour, four states have specifically allowed controversial stem cell research and 16 states have established limits on greenhouse gas emissions in an effort to curb global warming. Several states are defying the federal government on prescription drug importation and the medical use of marijuana.

In a recent example of states going their own way, Illinois Gov. Rod R. Blagojevich (D) signed an executive order July 12 creating a stem cell research program that includes $10 million in state grants in its first year.

“Since the federal government has chosen to stall the medical advancements that will come with stem cell research, it is up to the states to take action,” Blagojevich said.

Illinois joins California, which recently approved $3 billion in spending on stem cell research over 10 years; Connecticut, which approved $100 million over 10 years; and New Jersey, which approved $150 million for a stem cell research laboratory.

There are numerous other instances of states taking the initiative.

• New York Attorney General Eliot Spitzer, a potential Democratic candidate for governor, has cracked down on dubious financial practices the U.S. Justice Department refused to prosecute, using state laws to challenge mutual fund and insurance companies that put consumers at a disadvantage.
• Massachusetts broke new ground as the only state in the country where same-sex couples can legally marry.
• Maine began tackling its share of the daunting national problem of providing medical care for the country’s 45 million uninsured by launching a program that helps small businesses buy health care coverage for employees.
• And Minnesota’s Republican Gov. Tim Pawlenty has led a growing state rebellion against rising prescription drug costs by taking steps to help citizens import cheaper medicine from Canada.

Several factors have fueled the spate of state initiatives, including deep policy differences and resulting gridlock in Congress, tight state budgets that have forced experimentation with new policies to increase revenues or cut costs, the additional authority for such areas as environmental regulation and social welfare that Congress has given the states over the past 30 years, and an increase in lobbying at the state level by social advocacy groups.

But as states become more capable of developing sound domestic policy, a majority Republican Congress and President George W. Bush, himself an ex-governor, often fail to support the very activism that GOP leaders have encouraged for decades. Indeed, the states’ moves have run into occasional outright opposition from the Bush administration.

This, in turn, raises questions about the Republican Party’s long support for federalism and states’ rights and threatens to weaken the states’ role as a laboratory for policy solutions.

A prime example of the administration’s attitude toward states’ authority is the No Child Left Behind Act (NCLB), said Michael Bird, senior federal affairs counsel at the NCSL. “NCLB was devised by a party that traditionally held that education is a local issue, that less than a decade ago wanted to dismantle the [federal] Education Department. And yet it is the largest federal bureaucracy ever.”

Even when Utah, a Republican state with powerful leaders in Congress, sought federal flexibility, the administration offered no compromises, Bird noted.

And in the Terry Schiavo right-to-die case, Bush and Congress attempted to override the authority of the Florida court system to decide whether Schiavo’s feeding tube could be removed, interfering with what has traditionally been considered a state issue.

In an article soon to be published in PS: Political Science & Politics, a journal of the American Political Science Association, analyst Paul Posner theorizes that federalism may be on the wane.

“The real sea change is that the business community has shifted its support away from the states,” said Posner, who is the Government Accountability Office managing director for federal budget and intergovernmental relations.

In the past, businesses and state governments were allies, he said. But a “globalized economy, an increasingly nationalized media culture and a more centralized political system all portend the eclipse of federalism as a guiding principle in responding to the wide range of issues and problems on the national policy agenda.”

Now, “big business has become a foe of state innovation and a friend of federal preemption,” Posner writes.

Nevertheless, Richard Nathan, co-chair of the Albany, N.Y.-based Rockefeller Institute of Government, said that states will continue to champion interests and ideas discouraged by Washington. Nathan agrees that the current centralizing forces are powerful, but argues that the states have risen to the challenge and will continue to do so.

The fact that state governments can create effective social policy “when a Republican regime [in Washington] is so strong, bold, conservative” and apparently uninterested in states’ rights is proof that the constitutional underpinnings of the federal-state power sharing system are working, he said.

As the federal government focuses its attention elsewhere, “the states are having a field day,” Nathan remarked, adding, “It’s a good time to be a governor.”