Problem-solving at people level

Growing disgruntlement with the performance of the federal government is leading to a new round of thinking about who should do what in the American system of government.

The backlash has its roots in 1991, when Alice Rivlin published Reviving the American Dream. Rivlin, an economist and first director of the Congressional Budget Office, is a highly regarded policy analyst who made her home at The Brookings Institution when she wasn't serving in government. Now associate director of the federal Office of Management and Budget, Rivlin argued persuasively that we need to let the federal government handle defense, space, transportation and other issues that are truly national in scope and susceptible to a national solution. It would then fall to the states, according to Rivlin, to handle the nation's "productivity agenda" -- things like education, job training, housing, infrastructure and other issues that will affect our future competitiveness.

By getting these issues handled closer to the people, and by new approaches to tax and revenue sharing, Rivlin felt we could save billions -- as much as $75-95 billion -- and still get the job done better and more efficiently at the state and local level.

Now, these kinds of ideas are being advanced once again. Example: Sen. Nancy Kassebaum, R-Kan., has proposed a revitalized federalism as an alternative to the watered-down welfare "reform" plan being proposed by Clinton allies. Her proposal: Give the states full responsibility for all basic welfare and nutrition programs (e.g., AFDC, food stamps), including the freedom to change how public assistance is delivered -- without prior approval from Washington. In return, the federal government would take full responsibility for Medicaid (a major drain on state budgets), which gives poor Americans access to health care. Congress would also consolidate all 154 federal job training programs into a single, integrated program to help states and employers train real workers for real jobs.

On another front, there is growing disgust with wasteful Superfund spending and increasing recognition that the federal government is ill-equipped to make local, one-of-a-kind environmental cleanup decisions. According to former Superfund director Winston Porter, "the states are cleaning up sites faster and at much less cost than the federal Superfund program" -- e.g., 10 years and $30 million for the typical EPA cleanup compared with three years and less than $5 million per cleanup by the state of Minnesota. Reason: Cleanup decisions require local knowledge -- of the environment, land use and economic and community impacts -- and states have less bureaucracy.

Related issue: The annual "Fiscal Survey of the States," just released by the National Governors Association, continues to show relatively healthy state governments -- most of which, it should be emphasized, have a line-item veto, requirements for a balanced budget, and term limits for governors and, increasingly, legislators.

The problems of crime, health care, welfare, education, environmental protection and other issues need to be addressed by the level of government best suited to solve them. Policy changes are not enough. We have to change the way we do business. Reason: Most problems are not susceptible to top-down, one-size-fits-all federal solutions. The sooner we act on this truth, the better.