Can new federalism be rekindled?
Boston — President Reagan calls it ''a bold and spirited initiative'' that will once again make government ''the servant of the people.''
His critics call it a ''swap and dump operation'' in which the federal government merely unloads expensive responsibilities onto the states unprepared for them.
Whichever it is, the so-called ''new federalism'' - the massive turnover of federal programs to the states proposed in the President's State of the Union message last January - has recently been written off by many observers as all but dead. As the recession deepened and the budget debate lengthened, the idea drifted lower down the list of national priorities.
Now, however, it may have come to life again.
Last week, several top White House officials were busy reviving interest in it.
Presidential counselor Edwin Meese III, paraphrasing Mark Twain, told the annual meeting of the Chamber of Commerce of the United States in Washington April 26 that ''reports of its death have been greatly exaggerated.'' He insists that state and local government officials (the ones immediately affected by the changes) are still willing to continue their ''discussions and consultations'' on the issue.
And in remarks following a seminar in Boston April 27, Edwin L. Harper, assistant to the President for policy development, said he hoped to have legislation to Congress by the end of May.
He may also have breathed new life into the program by raising the possibility of compromise over a particularly thorny issue: food stamps.
The new federalism initiative, which many agree could bring about the most revolutionary shift in American government since the New Deal, would reverse a trend toward federal centralization that began with the 19th-century Morrill Act establishing land grant colleges.
The trend grew during the Roosevelt years, but exploded after 1965. Figures from the Office of Management and Budget show that by 1950, federal grants to state and local governments absorbed only 8.8 percent of the nation's domestic budget outlays. By 1978 they had reached 22.9 percent - after which, under President Carter, they began a slight decline.
New legislation to speed that turnaround will apparently focus on two broad areas:
* A turnback, in which some 40 programs in education, transportation, and community development would be handed back to state control. A $28 billion ''federalism trust fund,'' established to defray the costs of these programs in their early years, would gradually wind down until states assumed full financial responsibility in 1991.
In one sense, this part of the program has already begun. The 1981 budget act consolidated 77 so-called categorical grants in such areas as health, social services, and community development into nine block grants, giving states and municipalities more flexibility in using the funds.
* A swap, in which the federal government would agree to shoulder the full cost of medicaid (now shared with the states), while the states assumed the burden of the basic welfare program (Aid to Families with Dependent Children, or AFDC) and the food stamp program. Because of its immediate effect on state budgets, this swap is the most controversial part of the proposal.
Speaking to the Monitor after the seminar, Mr. Harper seemed to suggest the possibility of a major compromise on the swap. Asked about rumors that the administration might remove food stamps from consideration - leaving only a straight trade of medicaid for welfare costs - he said such a proposal was ''set off to the side of the table right now.''
''We're frankly still hopeful that we'll put all three together,'' he said. But he admitted that ''it's still a process of negotiation.''
For some states, food stamps constitute the most crucial element of the proposals. Another seminar participant, Gov. William F. Winter of Mississippi, told a press briefing that his state - the nation's poorest, with a per capita income only 69 percent of the national average - would be a heavy loser in a three-part swap.
He put his state's medicaid costs at $76 million and AFDC costs at $45 million. Food stamps, however, cost a whopping $270 million. A three-part swap would produce, he says, a $239 million deficit in Mississippi - equal to about 20 percent of the entire state budget.
In a two-way trade, however, he agreed that Mississippi would be a winner. And because a new federalism program would generally give mayors and governors more power, he has no objection to the initiative beyond an economic one.
Mr. Harper assured the Boston seminar that ''there would be no winners and losers.'' Government figures show states saving $19.1 billion on medicaid in 1984, while they spend only $16.5 billion on AFDC and food stamps. But he said that the President sees the initiative not simply in economic terms but ''as a matter of values stemming from the Constitution.''