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  •   Midwestern Mayor Shapes Bush's Message

    Stephen Goldsmith, AP
    Indianapolis Mayor Stephen Goldsmith is an adviser to Texas Gov. George W. Bush's bid for the GOP presidential nomination. (AP File Photo)
    By Terry M. Neal
    Washington Post Staff Writer
    Saturday, June 5, 1999; Page A6

    INDIANAPOLIS—Two years ago, Indianapolis Mayor Stephen Goldsmith was on a swing through Texas to promote his new book when Gov. George W. Bush summoned him to Austin.

    In a sense, Goldsmith never left.

    Goldsmith, 52, has emerged as the prime architect of Bush's domestic policy agenda, helping to shape and mold the governor's sometimes abstract-sounding notion of "compassionate conservatism" into palatable policies for a presidential campaign.

    The midwesterner has long been considered a hot commodity nationally – albeit a more polarizing one in his own state – for doing what many Republicans have talked about doing: applying conservative principles of smaller government to save money and deliver services more efficiently, supporters say.

    Goldsmith's philosophy meshes with Bush's vision of "compassionate conservatism," which seeks to take the harsh edge off conservative ideology without straying from basic tenets of smaller government and personal responsibility.

    In Goldsmith, Bush has found an intellectual soulmate who admirers say has demonstrated that downsizing government, cutting taxes and encouraging community solutions can not only work, but can do so with minimal backlash from traditional Democratic constituencies.

    Bush already has been criticized for his vague responses to questions about world and national issues, including Kosovo and abortion, and in Goldsmith, he has found someone who can help him develop an agenda that so far has been long on rhetoric and short on specifics.

    "He and I share a conservative philosophy," Bush said of Goldsmith in a recent telephone interview. "I think both of us understand the need to empower and uplift the individual. We understand that there is a role for government."

    Goldsmith's influence cannot be underestimated, and his appointment underscores Bush's desire to look beyond the usual inside-the-Beltway sources for advice, campaign aides said.

    About twice a month, Goldsmith, who will leave office in November, after deciding not to seek a third term, travels to Austin to coordinate discussions among the governor and some of the country's top thinkers, such as UCLA public policy professor James Q. Wilson and Princeton criminologist John Delulio. Goldsmith also has brought in more than 100 other, lesser-known experts from the worlds of academia, think tanks and consulting. The goal is to help Bush think through and define positions on a range of subjects, including Social Security, health care, housing, the environment and government downsizing, before he hits the campaign trail next week.

    Bush said he likes Goldsmith because he is "smart," he has a huge Rolodex of similarly smart people who could assist him and "he is also a compassionate conservative. He has a big heart. He cares for people."

    In an interview at his 25th-floor office in downtown Indianapolis, Goldsmith, 52, said his philosophies "are kind of eclectic, and they're rooted in some recognition of the importance of government and some suspicion about the way it traditionally works."

    Goldsmith, like most Republicans, denounces traditional urban housing policies and entitlement programs that pump money into inner-city neighborhoods without changing slum conditions. But Goldsmith says the GOP has lost the rhetorical battle because it ends the argument right there, rather than demonstrating how conservative principles offer a better alternative.

    In Indianapolis, he has focused on market-based incentives to lure businesses to the city as part of a $700 million campaign to rebuild poor neighborhoods. Goldsmith often has directed his staff to sell a city property in an abandoned neighborhood at an affordable price, then help the business through streamlined zoning and permit processes, and use city money to clean up the site, repair the infrastructure and remove pollutants.

    Downtown Indianapolis has seen a major renaissance during Goldsmith's seven years in office--a result in part of his efforts to keep taxes low, he said.

    "The idea isn't just to reduce taxes for the sake of reducing taxes," Goldsmith says. "The purpose is to see if we can stimulate the economy. . . . Tax rates restrict the economy. Regulation restricts the economy. Bad infrastructure restricts the economy. And when you restrict the economy, you restrict job growth, and the people who are first and most harmed are those with the least skills in the worst neighborhoods."

    Goldsmith built upon his reputation among GOP insiders as a lecturer at Harvard and Columbia, a contributor to the opinion pages of the Wall Street Journal and the Washington Times and an author for publications such as the Harvard Business Review.

    He is best known nationally for his efforts to privatize dozens of government agencies and functions, including street sweeping, airport operation, trash collection and wastewater treatment. According to his office, the city has saved nearly $400 million, cut taxes three times and decreased the overall city budget from $450 million to $441 million between 1992 and this year.

    Former House speaker Newt Gingrich (R-Ga.) called Goldsmith "the most innovative and creative leader in the country," Governing magazine named him public official of the year, and Time featured him in an article titled "Rising Republicans."

    But critics point out that while he was building his national reputation he was losing Indiana's 1996 gubernatorial election to Democrat Frank O'Bannon. Goldsmith's critics see him as a craven politician with a relentless drive for self-promotion and a reputation that exceeds his accomplishments. "The best news for national Democrats is that Steve Goldsmith is George W.'s top domestic policy adviser," said Joe Andrew, chairman of the Democratic National Committee.

    Andrew, a former Indiana party chairman, said, "The big-picture analogy is a good one for the Democrats. Steve Goldsmith, a nationally known Republican running against a lieutenant governor . . . is initially up 20 points in the polls. . . . Steve Goldsmith raises more money than anyone ever has before and then goes on to lose in a 10-point landslide because the rhetoric did not meet reality. And that's exactly what I think is going to happen to George W. Bush."

    Goldsmith suggested in the interview that he must be doing something right. More than 4,000 people from all levels of government have flocked to Indianapolis to study his model of success, he said. "I doubt there's anything we've done here that no one else has done, but I think maybe we've been a little more methodical."

    During a drive through the city, Goldsmith said he was eager to play a role in the Bush campaign. "My personal goal is to help cause government systems to better improve the quality of life," he said. "The larger the system, the better opportunity for you to have an impact on a larger scale."

    Back in 1997, Bush had heard much about Goldsmith but had never met him. The governor invited Goldsmith – the mayor since 1992 of the nation's 12th-largest city – to spend the night at the governor's mansion in Austin, and the two became friends.

    Bush particularly praised Goldsmith's efforts to "invigorate faith-based institutions, invigorate little armies to help neighborhoods in need" by encouraging churches and synagogues to work directly with schools, police and social service agencies to solve community problems.

    The idea, shared by Republicans such as Bush and Goldsmith, is that government should not solve problems alone but should help people and communities solve their own. Among Goldsmith's most well-known social programs is the Front-Porch Alliance, which connects city agencies, religious and community leaders, and businesses.

    Last year, Goldsmith, a former Marion County prosecutor, brought Boston preacher Eugene Rivers to Indianapolis to instruct local clergy how to follow Rivers's model for street-based interaction with gangs to reduce crime and revitalize neighborhoods. Church and community leaders who adopted the idea, coordinating with Goldsmith's community policing effort, said the decline in crime, and violent crime in particular, was virtually immediate.

    "He has allowed us to empower ourselves," said Olgen Williams, who runs a community center. Williams, a long-time Democrat, said he switched his registration to independent in part out of respect for what Goldsmith has done. "He stepped aside and said, 'You control your own destiny.' "

    Yet Goldsmith's critics note that Indianapolis has been one of the few big cities where the murder rate has risen during the 1990s. And in the 1996 race, Democrats charged that privatization was Goldsmith's way of rewarding big corporate political donors. Critics also say that although taxes have been kept down, many of the private companies that administer city services have increased user fees.

    "The one thing that Steve Goldsmith has been good at is getting national publicity," said former Marion County Democratic chairman Kip Tew.

    But Goldsmith remains focused on his message, and advises Bush to do the same. "We spend a lot of time arguing with the congressional Republicans about how conservatism needs to have a compassionate face, about how these policies create better opportunities for all citizens," he said. "Yet even after talking about that for two years, I fell into the same trap, which was defending small government without connecting the two [and] how it makes people's lives better.

    "It is perhaps both a style and a substance issue."

    Stephen Goldsmith

    Born: Dec. 12, 1946

    Home town: Indianapolis

    Family: Married to Margaret Murphy, four children

    Education: Wabash College, bachelor's degree, 1968; University of Michigan, law degree, 1971.

    Military service: U.S. Army Reserve, 1968-1974.

    Professional experience: Lawyer, 1972-78; deputy corporation counsel, city of Indianapolis, 1974-75; chief trial deputy, city of Indianapolis, 1976-78; prosecuting attorney, Marion County, 1979-90; Indianapolis mayor, 1992-present.

    © Copyright 1999 The Washington Post Company

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