What’s Changed (and What Hasn’t) Since Governing Started 30 Years Ago

We first published in 1987, a year when states and cities seemed poised for innovation.
by | October 2017

This is part of Governing's special 30th anniversary coverage.

There are times when American public life is suffused with a sense of possibility, a common belief that government can do big things -- solve problems that have resisted solution for decades. At the national level, 1933 was one of those times, as Franklin D. Roosevelt sought to experiment his way out of economic stagnation. So was 1965, when Lyndon B. Johnson could describe his dream of egalitarian Great Society and make it sound plausible.

There have been moments of similar ambition at other levels of government as well. The one that stands out clearest is 1987, a year when states and cities around the country seemed poised to emerge as sources of innovation and creativity across a broad range of policy areas: education, economic development, health care and social welfare, to provide a partial list. The federal government had been systematically cutting back its involvement in most of these fields, led by a president who had famously declared that government was the problem, not the solution. State and local leaders expressed confidence that they didn’t need much help from Washington; they boasted that their governments were the true “laboratories of democracy,” to quote Supreme Court Justice Louis Brandeis’ familiar saying from a half-century before.

Governing magazine was born amid that wave of enthusiasm: Our first issue was published in October 1987; we celebrate our 30th anniversary this month. We started out convinced that both power and ambition were moving down from Washington to the state and local level. Over the ensuing three decades, we have seen our original vision borne out many times and contradicted by reality quite a few other times. By and large, though, we continue to believe the things we believed when we began.

The centerpiece of Governing’s first issue was a long article by John Herbers, one whose headline pretty much summed up its central thesis: “The New Federalism: Unplanned, Innovative and Here to Stay.” “With a new sense of independence from the federal government,” Herbers wrote, “state and local governments have been taking on new responsibilities -- a change that promises to be both more profound and more permanent than most people have recognized.”

The withdrawal of the federal government from its role as a financial backer of state and local initiatives was well underway when Governing began publishing. The previous year, President Ronald Reagan’s administration had ended the 15-year practice of sharing revenue with governments further down the chain. By the fall of 1987, the administration was preparing to kill off Urban Development Action Grants, another source of federal largesse that was popular in cities all over the country. And another popular local aid program, the one that awarded Community Development Action Grants, was widely rumored to be on the way out, although ultimately that did not happen.

The response of many state and local governments to this collapse in federal support was to ramp up their own levels of economic development and safety-net spending. Most of them were solvent enough to do that. State spending increased by 6.3 percent in fiscal 1987 over the previous year. Localities had increased their overall spending by 26 percent between 1983 and 1986. There is no question that urban America felt itself under federal siege 30 years ago, but it also displayed a rising confidence that it possessed the wherewithal to cope with its problems.

Many state leaders believed that, in the absence of help from Washington, they could turn their states into economic development magnets, and quite a few created brand-new agencies to solicit new business. It was in the mid-1980s that ambitious governors began carving out a new role as international trade ambassadors, flying off to Asia and Europe on what would become a routine basis. Bill Clinton, then governor of Arkansas, reported that he went on an industry-hunting trip to Japan and found 11 other governors who were there for the same purpose.

It was in those same years that states began to take a much more active role in K-12 education, which traditionally had been virtually the sole province of local government. By 1987, states were paying roughly half the cost of elementary and secondary schools, several times what they had been spending only a few years before. The era of state takeovers in education was also beginning. By 1987, Georgia and Minnesota had passed legislation allowing them to take control of school districts deemed to be failing their students.

Another hotbed of state activism in the mid-1980s was social welfare policy. Experiments seemed to be underway almost everywhere, some of them relatively minor, but some highly consequential. Republican governors, led by Wisconsin’s Tommy Thompson, had begun to institute work requirements and time limits for adults on public assistance. Many of their ideas became part of the federal welfare bill that Clinton signed as president in 1996.

The evolution of welfare policy underscores one positive feature of American government in the 1980s that will be very difficult to replicate in the 21st century. Thompson, Clinton and a handful of other activist governors were allowed to play a role on the national scene that few governors can emulate today. Republicans in Washington cut off the flow of funds to states and localities, but they encouraged waivers that let governors launch extensive welfare policy experiments. When federal welfare reform efforts began to emerge, a bipartisan group of governors came to the White House to help draft the legislation.

Not only were governors working together across party lines to a remarkable extent in 1987, but states and their localities were pursuing common goals as well. One significant fact of political life was the number of states that passed laws allowing the locals to raise taxes to replace the aid that the Republican administration in Washington was no longer delivering. This was self-serving on the states’ part. The more money they allowed localities to raise on their own, the less they themselves would be asked to provide. But there seemed to be a more altruistic component as well: Localities had been the biggest losers in the drying up of federal aid. Most state legislatures seemed sympathetic to the local plight.

States were not only granting tax leeway to localities in the 1980s -- they were raising taxes themselves. One of the more dramatic political episodes at the state level in 1987 was the multibillion-dollar sales tax increase signed into law by Texas Gov. Bill Clements. The Republican governor had campaigned for office vowing no tax increases, but when the state’s business leaders told him that more money was needed for education, he changed his mind.

It is tempting to imagine that the current federal gridlock will lead to a new era of state and local cooperation, but that almost certainly won’t be true. Partisanship today is as deeply entrenched at the lower levels of the political system as it is in Washington. Governors are not the harmonious group that Herbers saw 30 years ago; they are divided into partisan camps nearly as impenetrable as the ones in Washington. And in most of the country, states and cities have long since abandoned the cooperative relationship that prevailed for much of the 1980s. Republican legislatures in more than 30 states have spent much of the year seeking ways to prevent local governments from taking meaningful action on a variety of fronts, from wage rates to environmental protection to LGBT rights.

In at least one important way, it is indeed 1987 all over again: Both state and local governments are steeling themselves for another round of austerity in Washington. But unlike 30 years ago, they show few signs of being able to work together to reduce the damage. And so the sense of heightened possibility that prevailed across the country in the fall of 1987 is very difficult to find in the fall of 2017. But breakthroughs of creativity and common purpose continue to turn up, sometimes in the unlikeliest places. Governing will keep looking for them.