For more than 50 years, since the advent of the New Deal, it has been an axiom of American government that leadership in planning and promoting the long-term health of the American economy must come from Washington.
Today that is no longer the case -- and a lucky thing too.
As the federal government and its head, the president of the United States, continue to flounder in managing the largest elements of economic policy, the states and the governors are stepping into the breach -- as far as they can.
The contrast was dramatic last week. On Monday President Reagan shot down the plan designed by the Republican Senate leadership for making major, long-term reductions in federal budget deficits. The growth of those deficits threatens the future of the American economy.
Once again Reagan put his peculiar ideology and his past campaign promises ahead of prudence and practicality and barred both revenues and entitlements (along with defense spending) from consideration by the budget-cutters. Once again he chose to avoid today's painful choices and thereby increased the risk of tomorrow's dire consequences.
By contrast, on Tuesday two governors were in this city-in-transition discussing how they are attempting to ensure their states' economic futures by making the hard choices -- and seizing the abundant opportunities -- of today. Government and private-sector officials from more than 30 states came to the National Governors Association session, abundant evidence that the issue is of importance across the country.
One governor was a liberal Democrat, Michael S. Dukakis of Massachusetts; the other, Dick Thornburgh of Pennsylvania, a Republican who is regarded as a Reagan administration loyalist. But their agreements overshadowed the differences in their outlooks.
Dukakis was there because his state has become a national model of successful economic transition -- moving from the old and dying textile-based economy to a modern high-tech economy with low unemployment.
Although unemployment remains high, Thornburgh's Pennsylvania is now well-launched on an effort to replace its declining supply of steel and other smokestack jobs with new service and manufacturing employment.
One key piece of Thornburgh's strategy is the Ben Franklin Partnership program. In that program, four university-based centers serve as the catalysts, in which a small amount of state investment is leveraged with larger chunks of private capital, to nurture new technologies and new businesses.
What both men emphasized was the need for states to do strategic planning and to pass up the lure of "quick fixes" in favor of longer-term payoffs.
Dukakis said that states have a natural capacity for doing that, because they can "fine-tune" plans for their own communities and regions in a way the federal government cannot. The close and cooperative relationships between government, business, labor and education that are vital for economic development to go forward depend on personal involvement by key leaders -- again most easily obtained at the state and local levels.
But none of this will help, the two governors agreed, unless the political leadership keeps the public focused on the need for long-term strategies.
"In Pennsylvania," Thornburgh said, "we tried to tell people this would be a decade of transition to a more diverse and future-oriented economy."
Thornburgh was elected to his first term in 1978, and pointed out that he spent more than half that term on a "Choices for Pennsylvania" project, involving a cross-section of the state's private leadership in the design of a long-term economic strategy.
During that first term, Pennsylvania, like other states, was buffeted by severe inflation, soaring interest rates, sharp cutbacks in federal aid programs and, finally, the deep recession of 1981-82. Thornburgh barely survived his reelection race in 1982.
But he said that despite those pressures, "once the long-term economic plan was adopted, it became the polar star for everything we did." And now, as he heads into his final year as governor, the changes in taxes, education, welfare, unemployment compensation and economic development programs are beginning to produce visible evidence of economic transition, even as the shutdowns and layoffs continue in steel and other older industries.
"The important thing," Thornburgh said, "is to commit the institution involved to see there is no quick-fix solution for the problem, that you can't satisfy the voters (or the stockholders if you're a private company) with a quick payoff."
Neither Thornburgh nor Dukakis uttered a word of criticism of Ronald Reagan. In a sense, what they are doing fulfills Reagan's wish for more state initiative and less dependence on Washington. But what a contrast between their concept of leadership and that of a president who cannot see beyond his imprudent campaign promises or manage to put the future first.