Clinton's People

By DAN GOODGAME WASHINGTON

These days, when political influence is measured in minutes of face time with Bill Clinton, rival job seekers jealously track the comings and goings at the Governor's mansion in Little Rock. More than a few of them took note when, amid the procession of Senators and big campaign contributors, a shy, intense, bespectacled man with an unfamiliar face met for nearly an hour one-on-one with the President-elect.

The mystery guest was David Osborne, 41, a public policy consultant and author who shares Clinton's passion for such nuts-and-bolts issues as bank lending to inner-city residents and privatized pothole repair. The two met in 1985, when Osborne interviewed Clinton for his first book, Laboratories of Democracy, which was published in 1988 and included an admiring chapter on Clinton's education reforms in Arkansas. Since then, Clinton has promoted Osborne's writings to fellow Governors. Osborne's ideas have been praised -- and implemented -- by politicians ranging from Republican Governor William Weld of Massachusetts to Democratic Governor Lawton Chiles of Florida.

While researching his latest book, Reinventing Government, Osborne spoke regularly with Clinton, who began using his ideas and examples on the campaign trail. Co-authored by Ted Gaebler, a consultant and former city manager, the book has sold 70,000 copies since its publication last February and has had a profound influence on policymakers around the country. "This book should be read by every elected official in America," Clinton gushed for a blurb on the dust jacket. "Those of us who want to revitalize government in the 1990s are going to have to reinvent it. This book gives us the blueprint."

Osborne and Gaebler show how state and local governments are dismantling bloated, rule-bound bureaucracies by injecting competition and market incentives. Using hundreds of case studies, the authors have distilled principles of "entrepreneurial government" that Clinton says he intends to apply in Washington. They include:

Steering rather than rowing.

Innovative Governors and mayors have learned, Osborne says, that just because the private sector is not providing a needed service, government does not have to "create a bureaucracy to do the job all by itself." Some governments hire private contractors to run prisons or sweep streets. Others act as catalysts -- bringing community leaders together with charitable foundations, for example, to build low-income housing.

Empowering rather than serving.

The underprivileged should be encouraged to help themselves through their own communities, Osborne argues, citing cities that have increased effectiveness and cut costs through community-based policing and tenant-managed public housing.

Injecting competition into public services.

While some cities and states have successfully privatized such functions as landscaping and data processing, Osborne emphasizes that "the important distinction is not public vs. private, it is monopoly vs. competition." Phoenix, Arizona, for instance, allowed private contractors to bid against city garbage-collection crews and spurred both to become more efficient.

Rewarding success, not failure.

Most of the federal money spent for welfare, food stamps, Medicaid and public housing "rewards failure because it only goes to those who remain poor," Osborne says. Clinton has addressed this problem with his vows to end "welfare as we know it" and replace "a handout" with "a hand up."

Emphasizing prevention rather than cure.

New Governors in California, Florida and Illinois have emphasized the prevention of social and environmental problems. Studies show, for example, that modest investments in prenatal care and prevention of drug abuse among pregnant women can save millions of dollars in hospital treatment for crack babies and other unhealthy infants.

A self-described "child of the '60s," Osborne graduated from Stanford and began writing about public policy as "my way to change the world." As a journalist covering California's 1978 tax revolt, however, he began to question liberal orthodoxy. "It seemed to me that I was watching a watershed event -- the end of the era of ever growing government spending that had begun with Franklin Roosevelt," he recalls. "I felt that progressives needed to take the lead in reforming taxes and making government more responsive."

Osborne, who lives in Essex, Massachusetts, with his wife and four children, may soon get a chance to put some of his ideas into practice: several Clinton aides believe the President-elect will offer Osborne a White House job or the chair of a commission to "reinvent" the federal bureaucracy. Economic adviser Robert Reich cautions that some of Osborne's ideas "probably can't be implemented," but adds that "David thinks about government in fresh ways. He constantly asks how the public, as consumers of government services, can get the most for its money." Bruce Reed, another adviser to Clinton, notes that Osborne is "a good friend for Clinton to have because he doesn't hesitate to speak hard truths or to take on powerful interests."

For now, Osborne refuses to talk about a job offer that he says hasn't been made. But whatever happens, Clinton aides say, he and his ideas will be as welcome in the White House as they have been in the Arkansas Governor's mansion.