- The Washington Times - Wednesday, December 3, 2008

Borrowing a line from the Republican-revolution playbook of the 1990s, President-elect Barack Obama on Tuesday told the nation’s governors that he wants them to reassert states as the laboratories for solutions to the nation’s big problems.

“That’s the spirit that I want to reclaim for the country as a whole,” Mr. Obama told the National Governors Association, gathered in Philadelphia. “One where states are testing ideas, where Washington is investing in what works, and where you and I are working together in partnership on behalf of the great citizens of this nation.”

Showing fealty to the Founding Fathers’ concept of federalism and states’ roles in a divided government is the latest statement of humility and outreach from Mr. Obama during his transition. It’s one olive branch Republicans said they hope to grab as Mr. Obama seeks to make good on his campaign pledge of change.

“Time will tell. I’m certainly hopeful he will indeed push for states to be the laboratories for change, because they can be,” said Gov. Mark Sanford, South Carolina Republican. “If one really believes in change, states are going to be front and center.”

State experimentation was the rage in the 1990s, when a high-profile set of Republican governors led a movement to reform welfare and education. Meanwhile, the governors’ allies in Congress sparred with President Clinton over enshrining the welfare reforms in federal law, finally reaching an agreement he could sign in 1996.

Now, with a looming budget crisis facing the federal government, both governors and federalism observers said Mr. Obama should turn to the states to lead the way on some of the items on the president-elect’s own to-do list of reforms, including Medicaid and expanded access to health care.

“That’s how we ought to do health care reform,” said David Osborne, a former senior adviser to then-Vice President Al Gore who studied federalism and is now with Public Strategies Group, a consulting firm that advises governments on how to improve their performance. “The federal government should create funding and incentives for the states to try their own models to expand access to health insurance and control costs and improve quality.”

Mr. Osborne said he doesn’t expect Congress to allow states that role — “it’s not the way senators and congressmen think” — but praised Mr. Obama for raising those sorts of prospects.

“I find it reassuring,” he said. “Obama seems by instinct to understand that not everything important in this country happens in Washington. Anybody who’s been a community organizer kind of gets that most government is at the state and local level.”

In encouraging the states to experiment, Mr. Obama didn’t refer to Republicans, instead tracing the concept back to Supreme Court Justice Louis Brandeis, who in a dissent in a 1932 court case said states could “serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country.”

Still to be seen is whether Mr. Obama lives up to his vision for states.

“I bet every new president makes a speech like this to the National Governors Association, and it doesn’t mean they’re going to do anything with it,” Mr. Osborne said. “George Bush was a governor who talked about things like this, and he didn’t govern that way.”

In addition to Mr. Bush, Mr. Clinton, a former governor of Arkansas, also talked up federalism, both before and during his two terms in office. He even wrote the foreword to the 1990 paperback version of Mr. Osborne’s book “Laboratories of Democracy.”

Speaking to the governors this summer, Mr. Clinton also urged them to recapture their role as “laboratories for democracy.”

Mr. Obama’s meeting with the governors was unprecedented for a president-elect, said Pennsylvania Gov. Edward G. Rendell.

In a private meeting with Mr. Obama, the governors pleaded with him to help them weather the recession, which has left at least 41 of the 50 states facing budget shortfalls this fiscal year.

The governors asked for about $130 billion in new money to fund projects already in the pipeline, and for a reduction in red tape they said constrains their ability to complete projects.

Mr. Obama’s incoming chief of staff, Rahm Emanuel, Illinois Democrat, told reporters traveling with Mr. Obama that both Republican and Democratic governors urged the Obama administration to fix the Federal Emergency Management Agency, which Louisiana Gov. Bobby Jindal, a Republican, said isn’t processing money fast enough.

Mr. Emanuel said Virginia Gov. Tim Kaine, a Democrat, questioned why under Mr. Bush the government has left American needs unmet while spending billions of dollars building schools and bridges in Iraq.

Mr. Obama has endorsed congressional Democrats’ plans for a short-term spending bill for infrastructure, arguing that it will give an immediate boost to the economy. Democrats in Congress have said the price tag could top $500 billion, or nearly 20 percent of last year’s entire budget.

The president-elect has said that in the short term, deficits will have to go up, but said eventually that he will turn his attention to streamlining the budget.

Mr. Sanford, who is the new chairman of the Republican Governors Association, wrote a letter on behalf of his Republican colleagues urging Mr. Obama not to raise taxes, block free-trade agreements or try to spend his way out of a recession.

He said that if Mr. Obama is serious about spending cuts at the national level, he should start now.

“My counterpoint back would be, I’ve been in the political process now 15 years. Everybody always talks about down the road, down the line, but the only legislative budget you’ve got that matters is this year,” he said.

Still, he praised Mr. Obama’s outreach to Republicans so far — something that has drawn plaudits from Republican lawmakers on Capitol Hill who say he has eased some of their concerns about how he’ll govern.

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