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JULY 14, 2003
Edited by Richard S. Dunham Can Bush Finally Finish Off the Great Society? With Republicans in control of both ends of Pennsylvania Avenue, it's not a great time for the Great Society. President George W. Bush and GOP leaders on Capitol Hill are seeking to restructure some of the signature social programs of the free-spending Golden Era of American Liberalism to fit the cash-strapped Age of Compassionate Conservatism. Among the mainstays targeted for overhaul: Head Start, Medicaid, and federal housing programs. Reviving the rhetoric of Ronald Reagan's unfulfilled "New Federalism" initiative, Bush and his allies want to give governors more authority and flexibility in administering social safety net programs. But while most governors are attracted to the concept of "devolution" -- as the Bush battle cry is called -- many worry that Washington is just shifting responsibilities to them without guaranteeing long-term support. The result, they fear: a series of huge unfunded mandates that would force politically risky decisions such as raising taxes or cutting benefits. "If there is a way to standardize and simplify these programs, that would be a plus," says Democratic Governor John E. Baldacci of Maine. "At the same time, we have to be careful because when you shift these programs from [the federal government] to block grants, states could be left holding the bag." Now under the congressional microscope is Head Start, the $6.7 billion program that provides nutrition, health care, and early education to nearly 1 million low-income 3- and 4-year-olds. Bush originally proposed giving governors lump sums to serve the nation's poorest preschoolers. Proponents argue this would allow state officials to integrate Head Start into existing educational offerings. Georgia, which has a pre-kindergarten program for all 4-year-olds, for example, would be a prime candidate for a block grant. "If you can coordinate Head Start with other state programs, poor children will get more help," says moderate Representative Michael N. Castle (R-Del.), a former governor and sponsor of the bill. Even opponents of devolution acknowledge that Head Start could be improved by focusing it more on early-childhood learning. But critics fear that cash-strapped states would simply divert block grants to other priorities. The first skirmish in the devolution wars was won by Bush's armies of compassion, but at a price. Concluding that a wholesale revamp of Head Start was too radical, the House Education and the Workforce Committee on June 12 voted to allow eight governors whose states already offer pre-K services, like Georgia and New Jersey, to receive block grants to run their Head Start operations for five years. While that's less than Bush had sought, friends and foes see it as a White House win. "They couldn't get a Head Start block granted this year, but...they've taken a major step toward doing just that," says Representative George Miller (D-Calif.), a leading critic. The Administration agrees. "We're very pleased with the House bill because it moves us in the direction of the President's vision," says Wade F. Horn, Health & Human Services Assistant Secretary for children and families. The pilot project looks likely to pass in the GOP-dominated House, but Senators Ted Kennedy (D-Mass.) and Christopher J. Dodd (D-Conn.) vow to block it in the Senate. Under state control, they fear, Head Start will skimp on health and nutrition. The outcome, when the Senate considers the legislation this summer, remains uncertain. But if the President wins a second term, he is almost sure to step up efforts to reshape more costly low-income assistance programs, including Medicaid, which provides health care to the poor and disabled, and federal housing. Four more years, and Reagan's deferred dream of shrinking the federal government could be realized by Bush. By Alexandra Starr CAPITAL WRAPUP The Real Party of Fat Cats A new study by the nonpartisan Center for Responsive Politics confirms Democrats' worst fears: They rely far more on fat cats than the Republicans. Despite Democratic claims that the GOP is the party of the rich, the analysis of more than 1.4 million contributors in the 2002 election cycle shows Dems got 92% of million-dollar-plus checks -- the kind now banned (unless the Supreme Court invalidates campaign-finance reform later this year). Small, hard-money donors gave 64% of their money to Republicans. The first evidence of the hard-money gap: In two weeks in late June, Bush is expected to have raised more than all nine Democratic Presidential hopefuls did in the past three months. A silver lining for Dems: They may have a lucrative target in professional women. Income-earning women, the CRP study found, gave 61% of their money to Dems. Women who call themselves homemakers favored the GOP.   CAPITAL WRAPUP Revenge on the Nile Having at least one developing nation on board -- Egypt -- was considered crucial when the Administration brought a WTO case against the European Union over its ban on new forms of genetically modified food. But under pressure from its major trading partner, Europe, Egypt has now dropped out, leaving the U.S., Argentina, and Canada as plaintiffs. Now, a seething White House has pointedly axed plans to negotiate a free-trade deal with Cairo.
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