Contract with America

The Contract with America and its chief architect, House Speaker Newt Gingrich of Georgia, became guiding forces for the 104th Congress when Republicans took majority control of the House of Representatives for the first time in forty years after the 1994 elections. Although it was essentially a campaign document, the “contract” promised that Republicans would institute procedural reforms in the House and would hold floor votes on ten legislative provisions with public opinion poll–tested titles such as the “American Dream Restoration Act,” “Fiscal Responsibility Act,” “Common Sense Legal Reform Act,” “Personal Responsibility Act,” and “Taking Back Our Streets Act.”

Inasmuch as the contract portended important changes in all manner of fiscal, social, and defense policies, it also offered the potential for a significantly new direction in the federal balance of power between the national government and the states. The contract marked an important moment in Republicans’ continued efforts to implement a “New Federalism” by shrinking the national government and devolving discretion over myriad policy areas to state and local government officials. House Republicans’ commitment to reducing the size of the federal government found expression in contract provisions that sought a constitutional amendment requiring a balanced federal budget, legislation to give the president the line-item veto power, and the Unfunded Mandate Reform Act, which limited the national government’s ability to impose policy mandates on states without providing federal funds for implementation.

Perhaps the most striking examples of the contract’s efforts at devolution were its welfare and crime provisions. On welfare, Republicans replaced Aid to Families with Dependent Children (AFDC), a long-standing federal entitlement program, with Temporary Assistance for Needy Families (TANF), a block grant program that allowed state governments to tailor their welfare programs and restrictions on recipients to meet their own policy and political goals. On crime, Republicans replaced President Bill Clinton’s 1994 crime bill, which provided grants to state and local governments to administer crime control and social programs (some of which were as specific as establishing inner-city “midnight basketball” programs), with block grants allowing state and local officials greater flexibility in how to spend federal dollars.

Nevertheless, Republicans were not averse to the use of federal power. Although, on the whole, the contract devolved policy discretion to the states, critics charge that these devolution efforts also transferred significant financial burdens to state and local governments seeking to compensate for cuts in federal spending. Moreover, if Republicans were willing to give greater discretion to the states in most instances, they also evinced a willingness to use the tactics of “coercive federalism” whereby the national government withholds funding from states who fail to comply with national officeholders’ policy goals. For example, one of the contract’s crime proposals, eventually passed as the Violent Criminal Incarceration Act, required that states strengthen their criminal sentencing guidelines in order to be eligible for $10.5 billion in federal block grants to states for the purposes of prison construction and administration.

SEE ALSO: Coercive Federalism; New Federalism (Reagan)