GOP Govs Get Dose Of Stimulus Reality

This story was written by Ben Smith.

But what began with a bang is ending with something closer to a whimper. All three of those governors have been forced to scale back their expectations, to varying degree, as the push of conservative philosophy gave way to the pull of political reality.

All three found that praise from the conservative movement in Washington meant nothing to furious state legislators of both parties. And in the end, along with other conservative Republican governors, the three submitted letters in recent days asking to be eligible for federal funds, a spokesman for the White House Office of Management and Budget confirmed.

"We've tried to compromise in a variety of different ways and now we've gotten to … a position well past the halfway mark," Sanford told POLITICO in an interview, conceding that, "I got beaten up pretty bad on it."

Sanford is still working to convince his state Legislature to find cuts to cancel out the new federal spending. Still, he has been attacked on his state's top editorial pages, by activists occupying a tent city outside his mansion, and by the Republican chairman of the state Senate finance committee, who released a "chaos budget" designed to show the downside of Sanford's plans. He responded to critics with a television ad Thursday, arguing that he was sparing his state's children from future debt.

Jindal, meanwhile, toned down his firm opposition and turned his focus to a much narrower rejection of two pots of money; Palin, too, has narrowed her objections and promised to work with legislators who want the money.

"At this point it looks like everybody's on board with the program," said Tom Gavin, an OMB spokesman.

The governors' shifts from a national ideological offensive against Obama to a defensive damage control approach at home reveals the degree to which Republicans are still struggling to find a coherent path of opposition to the president, and the extent to which governors' mansions - often seen as ideal steppingstones to the White House - can derail political careers in tough economic times.

And Democrats have relished the intra-party GOP warfare.

"What we saw was Gov. Sanford playing chicken and he got run over," said Hari Sevugan, a spokesman for the Democratic National Committee. "And we've seen, to varying degrees, others reaping blowback from local communities as well. But that's a natural result of taking a position based on politics instead of doing what's right."

Republican governors faced with the popular federal spending legislation, formally known as the The American Recovery and Reinvestment Act, staked positions on a political continuum, with national conservative support at one end, and local approval at the other.

Some, like Govs. Charlie Crist of Florida and Arnold Schwarzenegger of California, kept their approach local. They campaigned for the legislation with the president, and accepted the money enthusiastically. Schwarzenegger's Austrian birth bars him, in any case, from national office.

And Crist was less concerned about angering the conservative movement than about his standing in Florida, where he's considering a Senate bid.

Other governors sought a middle ground. Tim Pawlenty of Minnesota opposed the stimulus but accepted the funding on the grounds that "Minnesota is a net donor to the federal government," making the payments only fair.

Gov. Rick Perry of Texas also noted in his certification letter that his state is a net contributor to Washington.

Perry - along with Palin, Sanford, Jindal and Govs. Haley Barbour of Mississippi and Bob Riley of Alabama mdash; said he'd reject one portion of the stimulus: Unemployment insurance funding that would have covered laid-off part-time workers. In states whose unemployment programs don't currently cover those workers, the shift would have required changes to state law, and governors say they worried that when stimulus funds run out, the expanded unemployment insurance responsibilities will constitute a new tax on state businesses.

But the prospect of even partial rejection of the federal funds has sparked several statehouse uprisings. Lawmakers, including Republicans in Alaska, Alabama, South Carolina, Mississippi and Texas, moved to make end runs around their governors and accept the money.

Jindal - who became the party's most prominent voice against the stimulus in his rebuttal to Obama's State of the Union address last month - appears to be rejecting just one other pot of federal cash on top of the $98 million in unemployment insurance: $9.5 million in health spending. 

The local press noted, meanwhile, that he plans to request federal funds for a New Orleans-to-Baton Rouge passenger rail service from the same pot of railroad money he denounced as a vehicle for "wasteful spending."

A Jindal spokeswoman didn't respond to a request for details about his stance, but he wrote in his certification letter that he would spend the money "in a way that does not add an undue burden to the current financial situation in our state."

Palin's reversal was even more abrupt. She opened the battle March 19 by saying her state would "not request" some 31 percent of federal funds. Facing an uproar from legislators, her lieutenant governor, Sean Parnell, assured the media the next day that Palin wasn't "rejecting" the money, just seeking a public debate on spending. And Palin herself then weighed in, saying the money was still "on the table."

Palin has since pledged to work out differences with her Legislature, and her spokeswoman would only forward a copy of her March 31 certification letter.

"It is possible that there will be areas where the state will choose not to apply for funds," she said, noting that legislators were hearing public testimony and adding that she would apply for it on a "case by case" basis.

The concessions in Louisiana and Alabama leave South Carolina's Sanford as the only governor resisting large elements of the stimulus beyond unemployment insurance. Sanford plans to refuse $700 million from the State Fiscal Stabilization Fund, on the grounds, he said, that it would expand government and impede reform.

"Once you've got the money, there's no need to make the reforms," he said of changes he's seeking to the state education system.

The state's attorney general has said legislators can't accept the money without the governor's cooperation, leading to a charged standoff in Columbia that's left Sanford bloodied but, he says, undeterred.

"Over time we'll be vindicated, but it's been tough," he said.

By Ben Smith