Congress and Reagan's New Federalism

This article analyzes the congressional response to the Reaganadministration's New Federalism proposals in terms of party,region, and constituency during Reagan's first term. While theCongress approved various spending cuts in grants to local andstate governments and in means-tested benefit programs to thepoor, even in 1981 when New Federalism initiatives enjoyed themost success, Congress terminated only one program, CETA publicservice jobs. A stalemate developed in 1982. The Reagan administrationand the congressional Republicans could not impose further majorspending cuts or program terminations, and the congressionalDemocrats could not restore the 1981 cuts or add new aid programs.Although the stalemate continued on New Federalism's dismantlingof aid programs as a grand scheme even into 1985, after PresidentReagan's reelection, Congress continued to approve incrementalcuts in overall spending, and the $200 billion budget deficitremained as a lever to force even greater cuts and program terminationsin the years ahead.