The Governors List: What "too much" success has done.

George W. Bush has made it clear that he intends to rely heavily on the 29 Republican governors as a farm team for talent and policy advice. New Jersey's Christine Whitman and Wisconsin's Tommy Thompson are in the cabinet; Virginia's Jim Gilmore is heading the Republican National Committee; John Engler of Michigan, Tom Ridge of Pennsylvania, and, of course, Brother Jeb of Florida are among Bush's closest confidants.

After a White House meeting between Bush and a handful of Republican governors, Idaho's Dirk Kempthorne announced that "Bush's agenda is our agenda." They want Bush to devolve power to the states, and Bush seems happy to oblige.

Throughout the 1990s, Republicans dominated America's governorships. Roughly 61 percent of Americans live in states with a Republican governor, and these governors have been trailblazers on policy issues ranging from welfare reform and school choice to tort reform and the environment. Bush is also attracted to the governors for political reasons: Their state electoral machines were crucial to his victory in 2000.

Stylistically, too, most of the governors are a good fit for Bush's low-key, nonideological demeanor. Unlike the GOP congressional leaders, whose rough-edged partisanship makes Bush visibly squeamish, the governors are more naturally aligned with "compassionate conservatism." For years, political analysts and reporters-along with liberal-leaning country-club Republicans-have been applauding the governors for a shrewd governing philosophy that combines cultural moderation and fiscal conservatism.

But here's the problem: State-government expenditures are booming, and much of the spending spree is occurring in states with Republicans at the helm. The New York Times recently reported that at least half of the states are now experiencing a "fiscal emergency," and Governing magazine has declared that Republican governors have "rediscovered the joy of spending." In ten states last year, budgets rose by 10 percent or more; four of those states-Rhode Island, Virginia, Wisconsin, and Wyoming-have Republican governors. Nationwide, only about one of every seven dollars of state surpluses last year was sent back to workers through tax cuts or rebates.

What's going on here? Just seven years ago, New Jersey's Christie Whitman became a national supply-side heroine by riding her 30 percent income-tax-cut proposal to an improbable victory over an incumbent governor. The political and economic success of "Whitmanomics" touched off a nationwide tax-cutting spree. A new crop of influential and charismatic GOP governors-John Rowland of Connecticut, George Pataki of New York, Frank Keating of Oklahoma-joined Whitman, Tommy Thompson, and John Engler in this crusade.

And the tax cuts worked: They were a passport to prosperity and reelection. The states that cut taxes most had about twice the job growth of-and about 40 percent more income growth than-states that didn't cut taxes. Richard Vedder of Ohio University calculates that in the 1990s, about 1,000 Americans every day left high-tax states for low-tax states. (In the time it takes you to read this article, seven more New York and Massachusetts families will have joined the contemporary gold rush for low-tax havens like Arizona, Florida, and Texas.) Meanwhile, tax-cutting Republican governors have been getting reelected by sizable margins for the past several election cycles.

But now many Republican governors are starting to question their party's antitax philosophy. Cigarette-, gas-, and sales-tax rates are inching up again to fund pet spending projects. George Ryan of Illinois and Bob Taft of Ohio were elected in 1998, and both wasted no time in bullying through major tax hikes to pay for infrastructure spending. Jane Hull raised the Arizona sales tax to pay for school class-size reductions. Mike Leavitt of Utah has reaped the ire of conservative activists for supporting a tax on the Internet to pay for new spending. After Louisiana's Mike Foster extended a state sales tax on food, he publicly lashed out at his supply-side critics: "Some people in my party see tax cuts as the Holy Grail. It's not." (Unsurprisingly, Louisiana's economic performance over the past five years has lagged severely behind that of the rest of the country.)

Many governors have cast aside the economically productive rate cuts of the early 1990s in favor of such gimmicky tax-relief measures as tax rebates (in Connecticut, Colorado, Minnesota, Mississippi, and Wisconsin) and sales-tax holidays (in Florida, New York, and Oklahoma). In Texas, Bush himself put new meaning into the term "targeted tax cuts" by pushing for a sales-tax exemption for diapers.

This decline of tax-cutting fervor is surprising, because there's no indication that state income-tax cuts have lost their political luster. Even in Massachusetts, nearly 60 percent of the voters approved a measure-endorsed by Republican governor Paul Cellucci-to cut the income-tax rate from 5.85 percent to 5 percent. If tax cuts still play in Boston, they certainly should in Peoria.

The ranks of Republican governors still contain a number of fiscal superstars. Among those elected in 1998 are Florida's Bush and Nevada's Kenny Guinn, who have cut property taxes; Cellucci of Massachusetts, who took on the entire state establishment to win his ballot fight for tax cuts; and Colorado's Bill Owens and New Mexico's Gary Johnson, who have chopped income-tax rates. Johnson has been unrelenting: He has fought for tax cuts for six years, against a liberal legislature opposed to almost any loss of revenue.

But for every Reaganite antitax crusader like Gary Johnson, there's at least one Rockefeller Republican governor who boasts about increased spending. The national economic expansion from 1995 to 2000 has generated a tax-collection bonanza, and Democratic and Republican governors alike have tapped the windfall to fatten state budgets. In 1998 state spending rose by 6.8 percent, in 1999 by 8.2 percent, and in 2000 by 6.9 percent. That's over a period with almost nonexistent inflation; it's also twice the rate of federal spending over the same period.

Virginia is typical: For the first time in decades, the Republicans control both the legislature and the governorship, but the state budget soared by 10.6 percent last year. Now, as the economy slows and the fear of deficits reemerges, Republicans in the legislature want to scuttle the last step of Gov. Jim Gilmore's famous repeal of the car tax; they would rather destroy Gilmore's legacy than try to rein in the spending stampede. (Gilmore, laudably, has refused to cave, vowing to fight on for his car-tax repeal.)

The shenanigans in Tennessee are even more disheartening: Don Sundquist ran for governor in 1994 promising "no new taxes," only to flip-flop inexplicably two years ago-endorsing a first-ever income tax for Tennessee to close the $382 million budget shortfall created by Sundquist's own spending excesses. The costs of the tax-guzzling Tenn- Care health plan are rising at roughly twice the rate of Medicaid in all other states. Republican legislators have foiled Sundquist's plot to create an income tax, but he's expected to try again in 2001.

If Sundquist isn't the most fiscally reckless politician in America today, he's clearly in the top three. In New York, George Pataki-whose supply-side tax policies in the mid 1990s helped cure the state of its debt hangover from a decade of Cuomoism-infuriated conservatives by signing a 55-cent hike in the cigarette tax in 1999 to fund a multibillion-dollar health-care program "for children." He wants to expand the program again this year, even as the state's budget outlook has turned decidedly gloomy. It's gotten so bad in Albany that a New York Times editorial has gushed with praise for "Governor Pataki's Lean to the Left." Back in 1995, Pataki was a different governor, remarking in a speech at the Heritage Foundation that "in New York, government has become the uninvited dinner guest who arrives too early, eats too much, and stays too long." The more he "grows" in office, the bigger the margins of victory for people like Hillary Clinton.

And in Connecticut, John Rowland's 1998-99 budget was so larded with extra spending that it violated the state's constitutional spending cap and could be approved only by invoking the "Declaration of Extraordinary Circumstances" loophole. Political scientist Alan Ehrenhalt recently quipped: "Some fiend has kidnapped the conservative governor and installed a Hubert Humphrey liberal look-alike in his place."

Alas, that could be said of up to a dozen Republican governors these days: They're drifting to the left to appease voters who didn't vote for them-and who never will. Meanwhile, conservative voters in states like Arizona, Illinois, Ohio, Tennessee, Utah, and New York are starting to seethe over the betrayal. When dealing with the governors, President Bush needs to take great care to make his agenda theirs-not the other way around.