Domestic Duel

If you look behind the headlines, the presidential campaign is very much a clash of domestic ideology.
by | October 2004

While the presidential campaigns have traded fire over terrorism and John Kerry's military record of 30 years ago, a critical battle has quietly taken shape over the future of domestic policy--and especially over the federal government's relationship with states and cities.

Amid the noisy arguments about foreign policy, Bush's administration is crafting a coherent strategy to reshape domestic affairs in the years ahead. Kerry's struggles to dodge personal invective have sometimes made it hard for him to focus his response. But in an election year in which pundits have struggled to define fundamental differences between the candidates, they have only to look at federalism for the biggest chasm.

Bush has steadily been ramping up his push for "the ownership society." Much of government today, he argues, treats individual citizens like this: "We'll give you the orders and you pay the bills." Instead, he says, "government ought to be empowering people by giving them more control over their lives."

Bush's ownership society means a simpler, flatter tax code, incentives for people to buy their own health insurance, and personal savings accounts to replace part of Social Security. As Bush told one audience, his policies are "all aimed at encouraging people to help themselves and eventually being able to own something."

In fact, the administration's "No Child Left Behind" law, designed to force local schools to perform or give parents the right to move their children elsewhere, is a central building block of an even bigger plan. "We're going to continue to challenge the soft bigotry of low expectations," the president says, and use choice and ownership to transform the role of government.

Bush is seeking to transform the "reformer with results" theme he used in the 2000 campaign into a generation-long vision for a very different--and smaller--government. If he succeeds even in part, he will go a long way toward fulfilling the dreams of conservatives who have labored for a generation to dismantle the welfare state.

For state and local governments, this means stronger performance requirements in education, block grants for Medicaid, and more vouchers rather than categorical assistance for housing. It means pushing state and local governments to the role of junior partners in the federal relationship.

John Kerry's position could hardly be more different. He has accused Bush of trying to shrink Medicaid and turn it into an underfunded block grant to the states. He says that Bush has undermined the war on crime and crippled the campaign to bring communities a cleaner environment.

Kerry wants to "end the cop crunch" by restoring funding to the Clinton-era plan to put 100,000 more police officers on the beat. He's pledged "to ensure that schools always get the funding they need." And he promises to end inequality in health care by ensuring that everyone has access to high-quality health coverage, regardless of their gender, how much money they make, or whether they are disabled. All this will be expensive. Rolling back the Bush tax cuts would be a primary vehicle for generating much of the cash that the programs require.

In short, Kerry aims to restitch the social safety net that, he believes, has become badly frayed during the Bush years. In the Kerry plan, state and local governments play a central role. It would be impossible to overestimate just how big these issues are or how deep the divide is between the candidates.

Bush aims to use his next four years to radically redefine the very nature of domestic policy. State and local governments are not to be big players, except to the degree they provide the tools (such as education) for building the ownership society--and then only under tough performance standards. Moreover, the flatter tax system that Bush envisions could have huge implications for state tax systems, most of which are tied tightly to the federal tax code.

The emerging Bush domestic strategy is the first one since the Hoover administration that does not envision a major role for state and local governments. Kerry, on the other hand, sees reestablishment of federal funding across an even broader array of fronts as the key to the "new direction" that he says must replace Bush's "policies of failure." It's impossible to miss the paradox of the former governor shrinking the role of the states while the U.S. senator seeks to increase it.

In his acceptance speech, Kerry said "this is the most important election of our lifetime." Few would question that this is true of international affairs, even though the course either candidate would take over the next few years is anything but clear.

But it's demonstrably true for domestic policy, on which the candidates' paths diverge more widely than in any campaign in years. The 2004 election will move the nation toward one of two opposing visions of domestic affairs, with implications that could fundamentally transform the deeply rooted ties among the federal, state and local governments.

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