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9 Cities in the New Federalism Robert C Wood and Beverly K]imkowsky INTERGOVERNMENTAL RELATIONS TODAY The departure point for this inquiry is commonplace. What are the consequences of the Reagan administration's initiatives in restructuring and reducing federal inter- governmental aid programs for the fiscal fortunes and policy options of large American cities? At the outset, we simply stipulate conventional wisdom--the major contemporary observations and con- clusions about the present state of American federal- ism. Afterwards, we explore a less familiar terrain-- the urban political and policymaking processes that have emerged to cope with changing circumstances. The major stipulations are these: From the travail of the New Deal emerged clusters of federal aid programs that transformed constitutional doctrine on the federal system by replacing the concept of Dual federalism. with a ~cooperative. one, effec- tively setting aside the restraints of substantive due process, and establishing a national capacity to become involved in public domestic activities that was legally almost unconstrained. o From the New Deal era until the mid-1970s the num- ber of federally assisted programs carried out at state and local levels multiplied and the total dollar amount of federal aid grew rapidly. e During this 40-year period an intergovernmental process of policymaking emerged, familiarly known as the Boron Triangle,. that featured an alliance in urban pro- grams among aggressive mayors, responsive congressmen, and federal administrator-entrepreneurs who supported and encouraged categorical aid programs. 228

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229 The programs were subsequently implemented through the collaboration of professional program specialists in Vertical Axes. and orchestrated among professionals at all three governmental levels, which discouraged general policy oversight. As the Iron Triangles and Vertical Axes evolved, they introduced new components into the system. Kennedy- Johnson legislation empowered the poor to some extent through the vehicle of citizen participation. It also initiated the practice of targeting aid especially to large cities. In the Nixon-Ford years, the concepts of entitlement and the use of formulas, as in revenue shar- ing, reduced administrative discretion and limited the application of targeting, which was only partially re- stored during the Carter administration. By the mid-1970s the concurrent forces of growing economic constraints, political experience, and profes- sional evaluation of cooperative federalism resulted in a consensus that the delivery system was Overloaded. It cost too much; it was ineffective in impact; and it was inefficient in administration. In effect, Reagan's New Federalism embraced an al- ready accepted judgment as to the need for devolution and reform. It did so, however, during a period of na- tional economic recession and growing national govern- ment deficits. The result was sharply reduced appropri- ation levels and controversial ideological positions. Neither the budget cuts nor the ideology of the proposed ~trade-offs. of national and state responsibilities were accepted by many states and cities. ~ Although the Reagan administration's package was not completely enacted, 54 previous categorical grants were consolidated into 9 block grants. Total grants declined between 1981 and 1982 by $6.6 billion; and the consolidation into block grants was used to justify cuts of up to 25 percent. Grants previously provided to local governments were redirected to the states. Most observers agreed that the states' role in the intergov- ernmental process had been substantially enhanced (Nathan and Doolittle, 1984). THE NEW ~ MAYORS ~ GAME If the conventional wisdom is right in its estimate of the current situation, it is fair to assume cities are in a new ball game: more complex, more threatening,

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230 more uncertain than at any time since World War II. The late 1970s may have been grim indeed in terms of munici- pal fiscal crises and shifting Washington signals. But even the Ford administration bailed out New York City, and however much Carter's urban program resembled a seed catalog, an adroit city administration could find some useful items still in stock. Now, the most likely forecast for federal support to cities is one of continued and substantial cuts, exacer- bated by the national deficit and applied in the context of new power and discretion vested through the block grants in the states. It is this latter structural change that most sharply distinguishes urban fiscal experience in the eighties from the politics of scarcity that had set in almost a decade earlier. How are large cities responding and is there a pat- tern to the responses? One can sketch the broad out- lines of plausible strategies, but only after two obvi ous caveats. First, urban situations will vary with relative degrees of economic well-being, the local fis- cal systems that are extant, and the mix of local publi services that the city has come to support. Second, they will vary by the structural circumstances of the local forms of government: - strong mayors or weak; city managers or commissions; a large number of independent local governing authorities or a few in such areas as schools, housing, and transit; at-large or ward elec- tions; active or inactive community-based organizations; supportive or hostile private sector leadership; power- ful ~overlying. governments, such as counties or func- tional metropolitan districts, or less powerful over- lays. And the interface with the states must accommo- date corresponding structural variations at that level: strong or weak governors; large or small legislatures with different proportions of urban, suburban, and rural members; more or less professional bureaucracies; dif- ferent constellations of interest groups. The multiplicity of factors and possible forms of interaction having been acknowledged, it is still possi- ble to suggest some generalized propositions from which specific variations can subsequently be identified. .c All urban governments theoretically face the same options: to cut services, raise local taxes, economize, or seek resources from outside the local political sys- tem.

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231 In seeking outside resources all now must consider a three-track strategy. Federal aid is not eliminated and therefore must still be pursued. State grants take on a new importance and state aid must be cultivated with new vigor. The possibility of help from the pri- vate sector and not-for-profit institutions requires at least systematic exploration, even if the prospects seem marginal. The new importance of a viable strategy for state aid seems to require a city posture of accommodation to general state political leadership, which need not have obtained before. That is, the revenues the state per- mits localities to raise, the manner in which states allocate block grants, the structure of dispersal formu- las and indexes become more significant in a city's pol- icy calculations. The demonstration of urban minority political power, represented by the election of minority mayors, introduces racism as a factor both in local politics and in state-city relations. This takes on considerable potential significance, especially given the absence of minority governors and the relatively small role of mi- nority legislative caucuses. Urban-oriented interest groups face the necessity of redirecting their attention and resources to state capitols and revising their strategies of coalition building and cooperation. The variations in city bureaucratic style and the degree of professionalism further complicate the design of effective urban strategies. These general conditions suggest the following hy- potheses for empirical validation. The emerging inter- governmental political system for authoritatively allo- cating resources to localities is more unstable than its predecessor because of the changed character of guberna- torial-mayoralty relations, variations in state legisla- tive composition, new mixes in interest groups, and wide variations in the respective responsibilities, struc- tures, needs, and capabilities at state and local lev- els. One can expect a greater potential for conflict rather than for cooperation and less systematic sets of relationships than obtained with the federal Iron Tri- angles and Vertical Axes. A variety of urban strategies is likely as loose networks and shifting coalitions of uncertain character appear. Cities will first maximize

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232 their own resources. Accordingly, quite different pat- terns of accommodation are detectable, but the aggregate effect is a diminution of city capacity to secure re- sources and authority from outside the local system. Programs oriented toward the poor and minorities will especially suffer. TESTING: THE NATHAN RETURNS AND THE COMMI TTEE ON NAT TONAL URBAN POLI CY TYPOLOGY The task of marshaling evidence about where current urban strategies originate and how they are executed is greatly assisted by the ground already broken by Richard P. Nathan, Fred C. Doolittle, and their associates at Princeton University's Urban and Regional Research Cen- ter. In their study, The Consequences of Cuts (Nathan and Doolittle, 1983), the authors pioneered in examining the responses of 14 state governments, 14 large cities, and 26 smaller cities and suburban and rural governments to the federal aid reductions and the shift from cate- gorical to block grants. (We are much indebted to Nathan and his associates for providing access to the Center's original field reports and for the cooperation of many field associates in informally updating their observations.) Nathan and his associates concentrated initially on what specific program cuts were made and when and how the sample governments responded. They grouped their governments by comparative net replacement rates, ex- pressed in percentage intervals, and characterized them qualitatively as to degree of fiscal pressure they ap- pear under, their political ideology as determined by comparative public welfare spending, and in the case of cities, the role of overlying governments. We have chosen, in collaboration with DeGrove and Brumback, to extend the Nathan and Doolittle analysis for eight cit- ies. Their typology for these eight cities is presented in Table 9-1. With the exception of the apparent importance of overlying governments, there appears no strong associa- tions with the degree of replacement of federal grants now reduced and the fiscal pressure or political ideol- ogy of the cities. Newark, as Nathan and Doolittle note, might have been expected to have a more positive response, but its specific fiscal history explains its bottom position. Apparent reasons for the behavior of

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233 TABLE 9-1 City Classification by Nathan and Doolittle Typology Fiscal Political Role of Outly- City Pressure Ideology ing Governments Highest Replacement: Orlando Little Moderate Strong Los Angeles Extreme Moderate Strong Houston Little Moderate Strong Lowest Replacement: Chicago Moderate Moderate Strong Boston Extreme Moderate Medium Tulsa Little Conservative Weak Seattle Moderate Moderate Medium Newark Moderate Liberal Weak SOURCE: Classification scheme is drawn from Nathan and Doolittle (1983). the other cities are also described on a case-by-case basis by Nathan and Doolittle. We introduce two additional dimensions to the Nathan and Doolittle typology. The first is the average per- centage reduction of all the federal program cuts, rank ordered by city (see Table 9-2), and the second is the classification of the eight cities according to the typology employed by the Committee on National Urban Policy in Rethinking Urban Policy (National Research Council, 1983) (see Table 9-3). The typology of the Committee on National Urban Policy was developed in the context of examining the effects of the transition to a service economy on U.S. cities and metropolitan areas. It departs from conventional economic-base analyses, as well as the contemporary emphasis on differential re- gional patterns of development, i.e., snow belt and sun belt. Instead, it identifies the growing dominance of a small number of national Command and control. centers. Then, the typology classifies the remaining urban areas as ~subordinate.. Accordingly, it puts the 140 largest

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234 TABLE 9-2 Average Program Reduction by Cities (percentage) City Average Reduction Seattle Houston Los Angeles Chicago Boston Newark Tulsa Orlando 29 21 18 12 12 11 9 9 SOURCE: Nathan and Doolittle (1983). TABLE 9-3 City Classification by Committee on National Urban Policy Typology Command and Control, Diversified Service Centers City National Command and Control Regional Command and Control Specialized Service Centers: Functional Subordinate Service Centers: Resort-Retirement Los Angeles Chicago Boston Houston Seattle Tulsa Newark Orlando SOURCE: National Research Council (1983).

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235 metropolitan areas into four major classes of economic activity reflective of the emerging service-oriented economy: diversified service centers, specialized service centers, consumer-oriented centers, and pro- duction centers. The first two classes comprise na- tional and regional command and control centers; the last two classes comprise subordinate centers. (Chapter 3 in Rethinking Urban Policy describes the analysis in detail, pp. 38 95.) The status of the eight cities is consolidated from the three preceding tables in Table 9-4. Inspecting these arrays yields two further clues in addition to Nathan and Doolittle's emphasis on the role of overlying governments. First, the assumption that high replace- ment could most easily be made in cities that experi- enced low program reductions holds for Orlando, but not for the other cities. Seattle appears to be in the opposite situation, low replacement and high reduction. The other cities remain in roughly the same rank order, indicating pressures for program maintenance irrespec- tive of the size of reduction. Second, most cities are service-oriented command and control ones with reason- able economic futures, but Newark and Tulsa are vulner- able to changes in national economic conditions. One senses for the other six at least a latent capacity to respond--but working with these data alone no clear pat- tern emerges. Testing: Refining the Nathan Returns--Public Finance one can extend and expand Nathan and Doolittle's impressive work and the additional data we have intro- duced in two further ways. First, building on estab- lished models of local public finance, one can elaborate on demand-inducing factors in public service expendi- tures in the cities and on the fiscal capabilities for expanding revenues, thus elaborating on the concept of fiscal pressure. Second, one can refine the concept of political ideology by comparing topologies of political culture that are indicative of the intensity with which a local political system feels compelled to seek reme- dial replacement of the budget cuts. A genuinely authoritative inquiry into the relevant community characteristics is beyond the scope of this inquiry, involving at minimum such statistical tecX- niques as factor analysis. But a generation of research

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236 TABLE 9-4 City Rank Orders of Replacement and Reduct ion by CNUP Typology Rank Order Rank Order of of Average CNUP City Replacement Reduction Classification Orlando 1 8 Subordinate Service Center (Resor t-retirement ) Los Angeles 2 3 Diversif fed (National command and control) Houston 3 2 Diversified (Regional command and control) Chicago 4 4 Diversified (National command and control) Bos ton 5 5 Tulsa 6 7 Seattle 7 1 Newar k 8 6 Diversi f fed (Regional command and control) Specialized ( Functional command and control ) Diversif fed (Regional command and control) Specialized (Functional command and control ) SOURCE: National Research Council ( 1983 ) . has established that--after controlling for community size--~industrialization. (the proportion of land de- voted to industrial purposes and the value of business property) is the prime factor on the supply side in explaining levels of and variations in local expendi- tures. On the demand side, housing density, age distri- bution, and low-income prevalence are the most signifi- cant variables. When applied over time to comparative behavior of local tax rates, assessments, and expendi- ture levels, they have yielded consistently informative results (Wood, 1961). Contemporary analyses of local fiscal behavior employing regression analysis and other statistical techniques appear to confirm this behavior, although their focus is on other cities than those in the Nathan and Doolittle sample or they group cities with localities in general (Clark and Ferguson, 1983; Luce and Pack, 1984). We undertake no such ambitious

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237 research effort here. Simply examining the rank order of data is suggestive, however. (Rank-order tables for community characteristics appear as appendix tables.) The three high-replacement cities--Orlando, LOS Angeles, and Houston--are all rapid-growth cities, where Industrialization implied a growing local revenue base (in 1984 one would substitute Service-oriented command and control. or ~resort-retirement. for Industrial base. according to the classifications established by the Committee on National Urban Policy. The two command and control cities (Los Angeles and Houston) rank high in median income (see Table A-1). As a resort- retirement city, Orlando has a median income that is probably explained by cost-of-living differentials; the city still stands ahead of Boston and Newark in median income, however. When demand-oriented characteristics are considered, the high-replacement cities rank at the median in total dependent population (see Table ~-2) with high scores for population under age ~ and median scores on school- age and over-65 cohorts, which suggests reasonable pres- sure to respond. So does their middle rank in the per- centage of families below the poverty line (Table A-1). Unemployment rates--at the mercy of the national economy and not directly related to the grant programs under consideration--are low in Houston and Orlando and median in Los Angeles (Table A-3). For Nathan and Doolittle's high-replacement cities then, a picture emerges of high and growing taxable resources, coupled with reasonably strong demands gener- ated by a dependent population disposed to require city services and with the requirement to extend services to an expanding population (Table A-4). Los Angeles' ~ex- treme~ fiscal pressure seems essentially a factor of size and the fact that it is older and growing more slowly. Its capacity to transfer pressure to overlying governments is probably its escape hatch. In all three cities, the reconciliation of local response to national austerity appears to have been no big deal. Testing: Refining the Nathan Returns--PolitiCal Culture What of the demographic and economic characteristics of the low-replacement cities? In order of size, Chi- cago and Boston are high in loss of population, below average in median income, and above average in unemploy-

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238 meet. In expenditure-generating characteristics, depen- dent population and families below the poverty line, they rank sixth and seventh, respectively. Hence, in- creasingly limited resources face steadily growing de- mands, which their status as national and regional com- mand and control diversified service centers may be mitigating. To date, the constraints of their revenue sources apparently are controlling. Tulsa, a specialized service center, and Seattle, a regional command and control center, present different pictures--Tulsa's population growth rate was 9 percent between 1970 and 1980, but Seattle's population de- creased by 7 percent. Both cities are high in median income; Tulsa is low and Seattle high in unemployment. Seattle's dependency ratio is the lowest of the sample; Tulsa is the median of the sample. They have the two lowest percentages of poverty families. Accordingly, although Seattle has revenue-source problems in the loss of population and high unemployment, neither Seattle nor Tulsa has extreme service demands and both have struc- tured their low responses accordingly. What of Newark? A depressed functional service cen- ter and almost always at the bottom of every table, Newark has lost the greatest percentage of population; has the lowest median income, the highest unemployment rate; and the largest dependent population. Its per- centage of families below the poverty line exceeds that of al] other cities by 10 percent. It does not replace simply because it cannot within its own resources, even though its service needs are staggering. It may be that service needs are so awesome that the city ultimately gives up efforts to achieve even minimum program stan- dards of national acceptability. If a first cut at the interplay between supply- and demand-oriented factors of city finance sheds some further light on our cities' respective standings, what contributions can a delineation of political cultures make? That is, can the existence of a political dispo- sition to buffer cuts, establish different priorities, and exert leadership affect the response to federal cuts? Adapting Daniel Elazar's political culture (1972) typology for Nathan and Doolitt~e's 14 cities and our 8 produces the results displayed in Table 9-5. Elazar (1972:18) defines political culture as The particular pattern of orientation to political action in which each political system is embedded.. Tradition and-history

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243 health centers; Chicago acquired excess school property for later resale to private parties. The cities also sought to reduce their budgets. Per- sonnel freezes, cuts, layoffs, and restrictions on over- time were almost universally employed. Even before Reagan, Newark had reduced its work force by 30 percent between 1976 and 1980. Houston imposed a temporary hir- ing freeze--a most routine tactic. Los Angeles cut ~ex- pendable~ services--library and city attorneys. Boston cut ~vital. services in police, fire, health, and educa- tion as a prelude to confrontation with the state. In addition to personnel cuts came program reductions in Soft programs.--job training, nutrition, recreation, lead paint poisoning prevention, the arts, and the like. These intensified the effects of the Reagan cuts, for they affected the population already impacted by the elimination or reduction in the Comprehensive Employment and Training Act, Aid to Families-with Dependent Chil- dren, and food stamps. But, since their consequences were not immediately visible, mortgaging the service future in people terms was politically acceptable. Mortgaging the future in physical terms also seemed acceptable. Boston stopped all capital projects under way in midstream, leaving unfinished parks. Newark began a program of disinvestment and deferred mainte- nance. Seattle, Los Angeles, and Newark postponed main- tenance on roads and bridges. Just at the time ~infra- structure. was becoming a fashionable item on the public agenda, the cities appeared forced to avoid the issue. Efficiency in management became a popular city theme. Under the well-established rubric, Don't think, reorganize,. city after city adopted Dews management techniques. Los Angeles employed a forecasting firm; Boston contracted with an accounting firm. Houston announced new cost-benefit analyses Seattle established a central management system. New management techniques in fund control, the control of telephone use, office automation, and oversight of contractors became fashion- able. Orlando, Chicago, Newark, Seattle, and Houston all undertook agency reorganization. Viewed from the perspective of systematic financial strategy, the aggregate of city responses becomes a shotgun approach, seizing at whatever instrument for increasing revenues and reducing expenditures lay immediately at hand. The least politically offensive increases in revenues--new taxes and new fees--were tried. The least politically offensive cuts--in payroll

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244 and programs--and deferment of capital outlay programs were adopted. Nonetheless, most approaches were of the nickel-and-dime variety, not broadly enough based to mobilize powerful opposition, but not lucrative enough to solve any fiscal crisis. Postponement was the key posture: Leave the legacy of unresolved issues to the next generation of city management. Yet for all the shotgun, nickel-and-dime, potpourri the city responses seemed to exhibit, there was one extraordinarily constant political dimension. The cit- ies turned inward to their own resources and authority; launched few sustained drives for outside help from the states; and entered into few agreements that compromised their power to decide and to allocate. They did not try very hard--if at all--to alter the state-metropolitan- local structures for the delivery of services. They preserved whatever power and autonomy they possessed; they sought to maximize their powers within the local system. They did not significantly seek to invoke the philosophy of devolution to their own level, which Reagan had urged on the states. They did not ask of the states a comparable increase in local authority and in local resources. STAND-OFF TIME If large cities vary greatly in their economic and social circumstances, and their prospects for future prosperity, if their political cultures dictate quite different roles for their chief elective officials and for their bureaucracies, if extremely diverse city popu- lations have difficulty in achieving consensus, why in the initial years of federal withdrawal have they almost universally resorted to localized in-house responses? The answer seems to come, at least as Nathan and Doolittle's field associates report, in two parts. The first part is the national disposition of the dominant political actors on the local scene to control their own turfs. The second part is the absence of major incen- tives on the part of the states to respond to urban especially those of inner cities. city inclination to look inward is, in many cases, a function of stability. A mayor of long tenure in an individualistic-moralistic political culture, such as White of Boston, or Bradley of Los Angeles, will com- mand sufficient support to undertake major responses to needs, The

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245 financial adversity. When cities have weak political leadership, professional bureaucracy flourishes. In this context, Tulsa and Newark field reports provide ample evidence of the bureaucratic disposition toward proprietary collection and control of information and "bickering over turf. In either instance, mayoralty- dominated or bureaucratic-dominated politics is intro- spective. The tendency to go it alone is further enhanced in the case of urban minority political leadership. What- ever the fiscal plight of cities where black and His- panic mayors have come to office, however pressing the social needs, there is little disposition to seek relief by pressing for structural reform. Calls for annexation of adjacent suburbs or some sort of metropolitan federa- tion reintroduce the white vote that fled years ago and threaten the growing political power of city minori- ties. However troubled central city economic prospects may be, central city politics now provide a power base for minorities and enable them to wield substantial influence in national affairs and sometimes in the states. Giving up that newly acquired and hard-won clout to secure additional state resources at the expense of state imposition of new controls is not likely to be attractive. Finally, the constitutional and statutory position of cities, vis-a-vis the states, is now and traditionally has been carefully contrived. There is none of the legal ambiguity of respective roles that has historical- ly characterized federal-state relations. Dillon's (Plans and Greenberg, 1982:459) rule to the contrary notwithstanding, the cities have won their powers by charter or legislative decree through protracted negoti- ations. The ideology of grassroots self-government in the United States essentially implies fidelity to small local governments, suburban or rural. Cities rarely share in that symbolic support. Thus, stable, solid local political systems are not inclined to look to the states for help--the political costs of negotiating basic changes are too high, espe- cially for minorities. They are more likely to want to play a role in national politics, as in the Carter administration, and their relations with state officials are likely still to be contentious. City bureaucracies not only look inward, they are also often contemptuous of state counterparts. In either context, the cities are disposed to be stubborn.

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246 Given the necessity for state elected officials to look to metropolitan constituencies, especially the suburbs, for support, there is likewise little likeli- hood that states will rank big cities as a high prior- ity. So Seattle discovered, as the replacement and severity-of-cuts rank orders demonstrate; and Newark, in the reduction of its state aid in 1982 by $1.5 million. A Florida county administrator we interviewed expressed the feeling of many city officials when he stated: owe don't have much faith in channeling things through the state. They mandate things and don't meet their respon- sibilities. We'll get the short end of the lower dollar stick.. (Statistical confirmation on state behavior vis-a-vis localities in general comes from Luce and Pack (1984). Their simulations include the displacement be- havior of all 50 states. Luce and Pack (1984:354) con- clude Win many states, even (federal) aid cutbacks of 50 percent are not as harmful to local revenues as the dis- placement of federal aid which occurs when the state is made the intermediary between the federal and local gov- ernments.~) Moreover, the political chemistry between state and local political systems is often poor. Mayors, with some frequency, are disposed to seek the governorship, as did White in Massachusetts, Koch in New York, Bradley in California. City members of state legislatures, as in Massachusetts, often eye the mayoralty. A systematic review of challenges of urban leadership to governors in state elections (as compared with urban challenges in congressional ones) remains to be accomplished. Yet, one senses that the political alliances in the federal Iron Triangles were more comfortable than in the present contentious state-local networks. So the states are stubborn too--and suspicious as well. Where constructive relations appear to exist, they begin at the agency level, where tentative alliances of city departments and interest groups coincide. There is little evidence that gubernatorial-mayoralty relations have substantially improved. Indeed, the response of Connecticut's governor to the allocation of block grants was to turn the problem over to a negotiation-mediation team composed of state and local officials and community- based organizations. Private sector support--another tenet of the New Federalism--does not appear an option of much promise. There are marginal additions and rhetorical questions, to be sure. In Tulsa and Seattle, the United Way orga-

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247 nized special drives aimed at raising funds to replace part of the budget cuts. In Chicago, racetracks spon- sored special charity days, directing that the proceeds of the day go to local charitable organizations. Re- source networks examining the range of charitable activ- ities in Tulsa and Seattle were formed to make better use of the available resources. While private efforts responded, New Federalism errs in its assumption of how much of the burden private charities and corporations are willing and able to as- sume. Their capacity to respond falls far short of the amount of the budget cuts, leaving a large gap filled with people in need of services. The incapacity of the nonprofit sector to respond stems from its own depen- dence on federal dollars. Most persons do not know that ~nonprofits are often actively involved as partners of government in the operation of public programs; thus the same budget cuts that reduce the role of the public sec- tor also undermine the financial health of private, non- profit organizations. (Salamon and Abramson, 1983). Since nonprofit organizations derive approximately 35 percent of their revenues from the federal government, federal cutbacks seriously compromise their ability to perform at their prior level, to say nothing of assuming new responsibilities. At best, then, the private sector helps out in some critical program areas (i.e., summer youth employment), but it cannot play a genuine replace- ment role. City governments, however, are forging new alliances with overlying governments and with other city govern- ments on a needs basis. Although regional planning and other long-term efforts have generally failed, cities and counties willingly join forces to lobby state offi- cials on issues that affect them jointly. In Texas, mayors meet frequently to discuss common concerns and appeal to the governor jointly. The city of Seattle joined a court case contesting the narrowness of state definition of basic education. This case illustrates the alliance between local governments and the increas- ingly used tactic of cities' appealing to the courts in issues against the state. Increasingly cities challenge state government authority. A spate of cases has oc- curred throughout the country in which cities and poorer counties join together and demand more state money for education. City and counties also ban together to chal- lenge the limitations that states place on their power to raise revenue, enacting taxes that test those lim-

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248 its. Yet, these are not strategies for new structures or new patterns of collaboration. They are, instead, derived to extend and to expand the scope of local autonomies. CONCLUSIONS State and local government at a stubborn stand-off, the private sector with only a marginal capacity to respond, local intergovernmental alliances at the stage of cocktail collaboration designed to enhance local authority--what do we derive from these behavior pat- terns? The short answer is that our initial hypotheses seem confirmed on the basis of the data that this specu- lative inquiry has assembled. But there are further inferences to be drawn. First, through the euphemism of the New Federalism, the Reagan administration has achieved its principal objective: a substantial reduction in domestic spend- ing. Second, the places impacted most have, as residents, the people impacted most: the poor, the elderly, the young, and the sick. It is in the cities where economic and community characteristics indicate the greatest de- mands, the least resources, and the poorest prospects for development that the cuts fall usually most severely Third, these cuts are mitigated variously by ~scram- bling responses. that are dependent on the availability of local resources. Cities have no stable basis of funding to do otherwise, so they piece together a solu- tion. Fourth, state governments have, up to now, not shown themselves to be responsive when it comes to passing money through to local governments or to granting them autonomy to solve problems themselves. States have not been eager to take up the slack of services, beyond the most basic, that the federal government is abandoning. Fifth, there are no apparent Iron Triangles among state legislatures, cities, and agencies. At best, there are city-issue networks; temporary alliances emerge when immediate issues arise and are discarded when the issues are temporarily resolved. Interest groups, powerful at the national level, now are forced to mount 50 separate campaigns with vastly different mixes of political influence. Sixth, New Federalism exacerbates the tendency to

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249 mortgage the future of the cities and the needy. Infra- structure crumbles, new facilities do not appear. The cutbacks in preventive programs will likely haunt future policy makers. In sum, there is no detectable evidence that cities, even in time of a reviving economy, will benefit from the New Federalism. With no structural reform at the local level asked for or offered, local resources will be pressed even more. State aid to localities, even if expanded, will be skewed to suburban and rural communi- ties. Pundits of the 1990s may well look back on the work of their predecessors of the 1970s who denounced the Iron Triangles and the Vertical Axes that ~over- loaded. the system in the 196Os, and somewhat wistfully suggest that the national urban commitment was not alto- gether ill advised. Not only was the national interest in cities That work. abandoned and help to imaginative and forceful city leadership withdrawn, but also the authority and the power to provide support was returned to the states. It had been, of course, the state indifference to urban problems and state neglect of urban needs that had prompted the national urban policies in the first place. For all the professionalization of state govern- ment, whatever the effect of the ~one-man-one-vote. Supreme Court ruling, the politics of the states still are rarely oriented to their large cities. suburban constituencies replaced rural ones. The clock seems indeed turned back to the era when the states viewed cities as unfortunate aberrations in the polity and ultimately by their inaction and opposi- tion forced national intervention. There is little today to suggest a genuinely different state posture-- until national intervention comes again. REFERENCES Bureau of the Census 1983 County and City Data Book, 1983. Statistical Abstract Supplement. Washington, D.C.: U.S. Government Printing Office. Clark, Terry Nicholas, and Ferguson, Lorna Crowley 1983 City Money. Political Procession, Fiscal Strain and Retrenchment. New York: Columbia University Press e

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250 E1azar, Daniel 1972 American Federalism: A View From the States. ~ . New York: T.Y. Crowell. Luce, Thomas, and Pack, Janet Rohtenberg 1984 State support under the new federalism. Journal of Policy Analysis and Management 3(3), Spring:339-358. Nathan, Richard P., and Doolittle, 1983 The Consequences of Cuts: , Fred C. The Effects of the Reagan Domestic Program on State and Local Governments. Princeton Urban and Regional Research Center. New Jersey: Princeton University Press. 1984 Overview: Effects of the Reagan Domestic Program on States and Localities. Paper delivered at Princeton Conference on Effects of the Reagan Domestic Program on States and Localities, Princeton, N.J., June 7. National Research Council 1983 Rethinking Urban Policy. Committee on National Urban Policy, Commission on Behavioral and Social Sciences and Education. Washington, D.C.: National Academy Press. Salamon, Lester M., and Abramson, Alan J. 1983 The Federal Budget and the Nonprofit Sector. Washington, D.C.: Urban Institute Press. U.S. Department of Labor, Bureau of Labor Statistics 1982 Employment and Earnings 29(2). 1984 Employment and Earnings 31(2). Wood, Robert C. 1961 1400 Governments: New York Metropolitan Area. Harvard University Press. The Political Economy of the Cambridge, Mass.:

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251 APPENDIX TABLES TABLE A-1 Income Characteristics Median Percent Families City Income Below Poverty Line Seattle $22,096 6.6% Houston 21,881 10.0 Tulsa 20,956 7.4 Los Angeles 19,467 13.0 Chicago 18,776 16.8 Orlando 16,125 14.2 Boston 16,062 16.7 Newark 11,989 29.9 SOURCE: Bureau of the Census (1983). TABLE A-2 Dependent Population (percentage) Total Under Ages Age Dependent City Age 5 5-17 65+ Population Seattle 4.9% 12.7% 15.4% 33.0% Boston 5.3 16.3 12.7 34.3 Houston 7.9 20.4 6.9 35.2 Los Angeles 7.1 18.1 10.6 35.8 Tulsa 7.3 18.4 10.8 36.5 Orlando 6.1 17.8 12.7 36.6 Chicago 7.7 20.7 11.4 39.8 Newark 8.7 25.4 8.8 42.9 SOURCE: Bureau of the Census (1983).

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252 TABLE A-3 Unemployment Rates (percentage) Decem- Decem- ber ber City 1980 1981 1982 1983 Boston 3.7% 5.8% 7.1% 5.8% (Seattle) Washing- 8.1 11.1 13.0 10.5 ton State Orlando 4.9 6.7 7.8 6.3 Chicago 8.5 7.9 11.2 8.5 Tulsa 3.8 3.6 7.5 8.6 Los Angeles/ 6.1 7.4 10.4 7.0 Long Beach Houston 3.6 3.8 7.9 7.9 Newark 7.2 6.6 8.4 5.8 National Average 7.0 7.5 9~5 9 5 SOURCE: U.S. Department of Labor, Bureau of Labor Statistics (1982, 1984); Bureau of the Census (1983). TABLE A-4 Population Size and Rank Percent Change City Size Rank from 1970 Chicago 3,005,072 2 -10.8 Los Angeles 2,966,850 3 5.5 Houston 1,595,138 5 29.3 Boston 562,994 20 -12.2 Seattle 493,846 23 - 7.0 Tulsa 360,919 38 9.3 Newark 329,248 46 -13.8 Orlando 128,291 124 29.6 SOURCE: Bureau of the Census ( 19 83).

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253 TABLE A-5 Ethnic Diversity (percentage) Native City White Black Ameri- Asian Spanish can Tulsa 82.82 11.87 3.83 .82 1.74 . . . Seattle 80.24 9.43 1.38 7.88 2.58 . . . . . Boston 70.45 22.46 .26 2.89 6.47 . .. . Orlando 68.4 29.90 .23 .61 4.14 Los Angeles 62.00 17.00 .65 6.96 27.48 Houston 61.53 27.56 .25 2.22 17.60 Chicago 50.33 39.84 .23 2.45 14.09 Newark 32.64 58.30 .28 .74 18.62 SOURCE: Bureau of the Census (1983). TABLE A-6 City Government Employment Per 10,000 Population City City Employees Houston Tulsa Los Angeles Chicago Seattle Orlando Newark Boston 114.3 115.0 136.9 141.4 172.1 256.4 373.1 444.0 SOURCE: Bu r eau of the Census (1983).