RUTHFULLY YOURS

Inauguration Day 2013 was a moment of jubilation for conservatives. After four years of lackluster economic growth and a series of personal and policy mistakes, the incumbent chief executive, a history-making Democrat, was replaced by a conservative with an attractive policy agenda and a skillful campaign team. In a concise, hopeful inaugural address, the newly elected Republican leader of the executive branch promised to focus the administration’s attention and resources on job creation and economic growth in the short run, while setting the stage for long-term solutions to the government’s fiscal woes.

I’m describing the inauguration of Pat McCrory, North Carolina’s first Republican governor in 20 years. His election to replace retiring one-term Democrat Bev Perdue, the state’s first female governor, was one of the few bright spots for the GOP last November, so McCrory got more national attention than the incoming governor of the nation’s tenth-largest state would normally have received.

In general, however, Republican success in state and local politics is an underreported story. It extends far beyond the Tar Heel State. The post-2012 talk of conservatism’s electoral weakness and policy failures is disconnected from the personal experiences of many politicians, journalists, analysts, and activists who work at the state and local levels. While grassroots conservatives were disappointed at the reelection of President Obama and Republican misfires in races for the U.S. Senate, they continue to enjoy unprecedented influence and success in state capitals — while local liberals feel alienated from the governments and institutions they long dominated.

Even after giving up some of their 2010 legislative gains thanks to Obama’s 2012 coattails, Republicans still control more state offices than they have in generations. They hold 30 of 50 state governorships and 58 of 98 partisan legislative chambers. The nonprofit news service Stateline reports that in 25 states, comprising 53 percent of the U.S. population, the GOP controls both the executive and the legislative branch. Only 13 states, with 30 percent of the U.S. population, have unified Democratic governments. In addition, Republicans are strongly represented in local government, albeit primarily at the county level rather than in the increasingly Democratic big cities. In some states, such as my native North Carolina, the GOP’s local success has no modern precedent: A majority of the state’s 100 county governments are now under Republican control, which hasn’t been the case since General Sherman’s army was camped outside Raleigh.

As it happens, the political transformation of North Carolina and other states in the formerly Democratic “Solid South” is a big part of the story. In the 2012 cycle, voters in the last state of the old Confederacy with a Democratic legislature — Arkansas — gave Republicans control of both chambers. In the broader South, only Kentucky’s house of representatives retains a Democratic majority. Elsewhere in the country, Democrats regained some legislatures they lost in the Republican-wave election of 2010, such as those in Minnesota and Maine. But the GOP retained its recent gains in other presidential-blue states, such as Michigan and Wisconsin.

The regional dynamic reveals much about the ideological effects of recent political trends. Partisan affiliation doesn’t always predict political views or voting behavior. In the past, there were significant numbers of center-left Republicans and center-right Democrats. Members of the latter group traditionally held many congressional, gubernatorial, and legislative seats in the South and Midwest. But the days of boll weevils and blue dogs are approaching dusk. Once southern and midwestern state electorates became more amenable to the Republican label for state and local offices, the two parties began to polarize by ideology. Individuals who might once have run and served in office as center-right Democrats have either become Republicans — usually moving rightward to win their primaries — or yielded to GOP candidates with even more reliable conservative inclinations. Both phenomena have red-shifted the ideological spectrum in state government.

Another way to think about these political trends is as a giant switcheroo. From 1968 to 1988, Republicans won popular-vote majorities in five of six presidential elections while Democrats were firmly ensconced as the majority party of state governments and the U.S. House. But from 1992 to 2012, Democrats have won popular-vote majorities in five of six presidential elections while Republicans have gained the advantage in House races and the states. (Control of the U.S. Senate hasn’t precisely tracked the other results.)

The Founders intended the U.S. House to represent popular will through direct election and the U.S. Senate to represent popular will as channeled through state legislatures. Since the ratification of the 17th Amendment, popular votes have decided all races — but, interestingly, state legislatures have come to exercise a significant influence over the House. Responding to recent Voting Rights Act jurisprudence and using sophisticated data-analysis techniques, Republicans have redrawn congressional maps to their party’s advantage. To an extent that remains underappreciated in Washington, the power of Speaker John Boehner and other Republican leaders of the House to challenge President Obama and the Democratic Senate originated with GOP success in legislative races and depends on its continuation, as does resistance to the implementation of Obamacare.

How did Republican candidates and conservative ideas become more competitive at the state and local levels? A number of factors are at work. The migration of GOP-leaning voters from northern and midwestern states to the South during the 1970s, 1980s, and 1990s helped strengthen southern Republican organizations at the local level. More generally, the Republican party has channeled significant resources, including money and political talent, into state and local politics from coast to coast. The process began in 1978, when former Delaware governor Pete du Pont founded GOPAC to recruit and train Republican candidates for state and local office. It ramped up when Newt Gingrich, then a House backbencher, took over GOPAC operations in 1986.

Separately, conservative donors began to create a panoply of new institutions — independent-expenditure committees, grassroots organizations such as Americans for Prosperity and FreedomWorks, the American Legislative Exchange Council to advise conservative state lawmakers, and state-based think tanks — to promote conservative principles in general, to fashion free-market policies, and to propel these policies through the legislative process. Using print, broadcast, and online media, they transformed the flow of information to policymakers, activists, and the voting public. Where liberal academics, special-interest lobbyists, and government staffers once monopolized the crafting of legislation, conservative think tankers and policy experts now offer different ideas to governors and lawmakers. Where liberal media outlets once monopolized the coverage of legislative issues and political scandal, new conservative media (such as the statewide newspaper I publish, the Carolina Journal) now play a role in setting the political agenda and exposing wasteful or corrupt government programs and officeholders.

The donors and policy entrepreneurs who spent the past two decades building a strong conservative movement at the state and local levels knew exactly what they were doing. The policy environment matters a great deal in state politics. If you are a successful, goal-oriented conservative who is thinking of running for public office, you consider more than just the possibility of getting elected. You wonder what it will be like after the election. Will you be a lonely voice in the wilderness, fated to champion doomed bills and subject to constant attack and ridicule by the liberal establishment? Or will you be joined in office by other thoughtful conservatives, and receive support and encouragement from like-minded opinion leaders and effective, well-financed public-policy groups?

In the past, many able conservatives took a look at their bleak post-election prospects and decided against running for governor, the legislature, or county office. Now, many of them seek office with the expectation not only of winning in November but also of winning subsequent battles over taxes, government spending, regulation, education, and other issues they care about. Greatly improved candidate recruitment has proved to be one cause of Republican political success at the state and local level.

Understandably depressed about the 2012 federal elections and the manifest inability of Washington to take on the nation’s economic, fiscal, and foreign-policy challenges, some conservatives might be tempted to dismiss the significance of down-ballot political trends. They might well ask what difference it makes who controls the governor’s offices in Virginia and Ohio, or the legislatures in Michigan and Florida, if the Obama campaign still won these states’ electoral votes and conservatives couldn’t win their U.S. Senate seats. I would answer that conservatives should not place such a strong emphasis on Washington and the daily to-and-fro of Capitol Hill politics.

Often without a great deal of national attention, conservatives have turned their electoral victories in the states into legislative victories on many policy issues. These victories include Wisconsin’s initiatives on tort reform and public-sector unionization, Michigan’s passage of right-to-work protection, the implementation of criminal- and civil-justice reforms in Texas, and successful referenda in a dozen states — nearly all governed by Republican majorities — to enact constitutional amendments outlawing eminent-domain abuse. These victories are important not only on their own terms but also because they can build institutional knowledge, conservative confidence, and momentum for future battles, including those in the nation’s capital. Two examples merit a closer look: fiscal policy and education reform.

America’s fiscal problems aren’t confined to short-term federal deficits or unfunded liabilities in federal entitlement programs. According to the Tax Policy Center, total government spending made up a record 37 percent of America’s GDP in 2010, a statistic that fell only a single percentage point in 2011. State and local expenditures accounted for roughly one-third of these amounts, and even more if you consider that much of the federal “stimulus” package consisted of bailing out profligate states with supplemental Medicaid, education, and unemployment-insurance funds. Moreover, underfunded state and local pension and health-care plans add trillions to the nation’s long-term liabilities.

The good news is that, while conservatives are properly frustrated at the inability of Republican politicians in Washington to make major headway on spending restraint and tax reform, the new generation of GOP leaders elected to state office over the past few cycles has a far better record. Both case studies and statistical comparisons demonstrate that partisanship makes a difference in state budgeting. Until recently, that wasn’t the conventional wisdom, because analysts focused too much on governors. When it comes to fiscal policy, legislative control matters much more.

Writing in The Journal of Politics in 2000, James Alt of Harvard and Robert Lowry of Iowa State described their study of more than four decades of state budgeting and partisan affiliation. They found that “Democrats nearly everywhere target a larger share of state incomes for the public budget than Republicans,” and that when either party enjoyed unified control of a state’s legislature, it tended to get its way on fiscal policy even when the governor was of the other party. In 2006, University of Oklahoma economist Robert Reed examined 40 years of state tax data and found something similar: States with Democratic governments consistently had higher tax burdens than states with Republican ones. And once Reed adjusted for partisan control of the legislature, partisan control of the governorship had little effect.

At the onset of the Great Recession in 2007, states and localities found themselves with falling revenue forecasts and escalating service demands. Their responses reflected party and ideology. Democratic governments tended to raise taxes across the board. Republican governments tended to say no to new taxes, or at least to broad-based tax hikes, while cutting budgets. According to the Tax Foundation’s analysis of 2010 data from the U.S. Census, the ten states with the highest combined state and local tax burdens took an average of 11.2 percent of their residents’ income in 2010. The average for the ten lowest-taxed states was 7.9 percent. Put differently, the high-tax states took 42 percent more of the typical person’s money. Nine of the ten most-taxed states had Democratic legislatures. Most of the ten least-taxed states had Republican legislatures, and three others were southern states with relatively moderate Democratic legislatures. Since 2010, all three have been replaced by more conservative Republican legislatures.

It’s not just in overall spending and tax amounts that the new generation of Republican leaders is having an effect. Governors and legislative leaders in several states are now pushing sweeping reforms of their state tax codes, seeking to reduce or eliminate punitive taxation on investment and job creation. For Democrats, tax reform is about filling “loopholes” to make government larger. For Republicans, tax reform is about eliminating biases to make the private economy larger.

As for education, those who expected rising Republican power in state and local government to result in universal vouchers and large-scale privatization of public schools were guilty of inventing either utopian or dystopian fantasies, depending on their point of view. In reality, conservative leaders and policy experts had fashioned a strategy for education reform by the mid-1990s that included several elements: 1) higher academic expectations with rigorous assessments of student progress; 2) reform of teacher tenure and compensation policies; and 3) greater choice and competition in the delivery of education services.

Once they achieved electoral success, conservative policymakers set higher standards and instituted annual testing. They challenged teachers’ unions on performance evaluation, pay, and work rules, especially in the Midwest and South. Nearly every state now allows the creation of independent public schools, run by private entities with government charters. As of the 2011–12 academic year, there were some 5,700 charter schools in operation across the country, enrolling about 2 million elementary and secondary students. That’s up from only 1,650 charter schools in 2000–01. As for helping parents send their children to private schools, the Friedman Foundation reports that 22 states have some kind of tax deduction, tax credit, educational savings account, or scholarship program in operation — often more than one. Almost all of these programs have been implemented since the 1994 Republican-wave election transformed state capitals, although many of the bills have received bipartisan support.

Perhaps the best example of the conservative strategy in action can be found in Florida. Republicans took control of its senate in 1992 and its house in 1996 — marking the first time since Reconstruction that both legislative chambers in a southern state went red. Two years later, Jeb Bush was elected governor on an ambitious platform of education reforms including higher standards, new testing, letter grades for every public school, alternative teacher certification, management reforms, and school-choice programs focused on students who had special challenges or were trapped in low-performing schools. The results have been difficult for even left-wing critics to dispute, although some have tried. Graduation rates are up 20 percent. According to the Thomas B. Fordham Institute, which grades state educational systems,Florida’s math standards leapt from an F to an Afrom 2005 to 2010, andits English standards rose from a C to a B. Once mired near the bottom of the list in National Assessment of Education Progress scores, Florida has posted dramatic gains during the past decade. And in the latest international study of reading performance, released in December, Florida excelled — outscoring 48 of 52 participating education systems and tying the others.

Since leaving office in 2007, Jeb Bush has advised governors, legislators, and education leaders across the political spectrum. For the most part, however, his Republican audiences have responded most favorably. Last year, Indiana and Louisiana enacted sweeping education-reform bills crafted by conservative leaders (including Mitch Daniels and Bobby Jindal) that built and even improved on Bush’s ideas, including tenure reform and a greatly expanded role for private schools.

I don’t mean to suggest that Florida has been the only incubator of education innovation. Years before Bush was elected, other states acted separately to implement elements of the strategy with impressive results. Minnesota, for example, enacted the nation’s first charter-school law in 1991. A couple of years later, Massachusetts pioneered the idea of raising academic standards and using rigorous annual testing to measure progress. North Carolina implemented both ideas in tandem in the mid-1990s. As it happens, Minnesota, Massachusetts, and North Carolina joined Florida among the highest-achieving education systems on recent international math tests. In these three states, the reforms of the 1990s emerged from divided governments, as the election of Republican governors or legislatures created opportunities that bipartisan coalitions then translated into legislation. Because Governor Bush had a Republican legislature to work with, however, he was able to fashion a more comprehensive approach.

We should not be naïve. New Republican governments at the state and local levels haven’t always produced conservative leadership, and conservative leaders still have a lot of work to do if they seek to transform state and local governments into smaller institutions that promote economic growth, refrain from encouraging dependency, and deliver a bigger bang for the taxpayer buck.

And state Republicans’ successes can be difficult to apply at the federal level. The federal government lacks elements of the required institutional framework for conservative victories of the type found at lower levels of government. Enforceable rules against funding operating deficits with debt have been critical, and state experience suggests that an item-reduction veto (i.e., giving the governor the ability to reduce spending on a line item rather than vetoing the item or the entire bill) is a key tool for governors who want to cut spending. Without enacting some kind of balanced-budget requirement or constitutional cap on federal spending, and without strengthening the president’s veto power, Republican success in future federal elections will likely prove insufficient to the task of imposing fiscal discipline on Washington.

What I am suggesting, however, is that the conservative movement should stop wallowing in its recent failures and start studying and replicating its recent successes. You’ll find those successes, and most conservatives, far from the banks of the Potomac.

– Mr. Hood is the president of the John Locke Foundation, a public-policy think tank in Raleigh, N.C., and the author, most recently, of Our Best Foot Forward.