03/29/2011 02:48 pm ET Updated May 29, 2011

Governors Should Consider Weld Model in Fighting Fiscal Deficits

As governors across America struggle to close their operating deficits and reform their state governments, they should consider how one former Republican governor -- William Weld -- brought Massachusetts, the most Democratic state in the country, back from the brink of bankruptcy. Who says Republicans and Democrats can't work together?

In 1991 during Weld's first year as governor, Massachusetts faced a $1.3 billion dollar budget deficit. State unemployment reached 9.1%, 2.2% above the national average and the state's bond rating, a broad measure of fiscal stability, was BBB, which was one grade above junk bond status.

Just as troubling was the business community's perception of state government. The prior administration, run by Michael Dukakis, had borrowed heavily from Wall Street to cover operating deficits and then raised taxes to pay for the debt service on the bonds. By 1991, Massachusetts ranked second nationally in terms of highest state and local taxes per capita.

With the state on the verge of fiscal collapse, Weld had to make tough decisions that were not politically expedient. He proposed furloughs for state employees, privatization of certain state services, cuts in local aid to cities and towns, cuts in Medicaid, and the sale of underperforming state assets. There weren't many state programs that he didn't cut during his first year in office to balance the state's budget.

Similar to many governors today, Weld faced heavy criticism for his proposed budget cuts. Thousands of protesters, human service groups and other affected constituents picketed at the state house, booed him at public events, and otherwise accused him of being callous.

In the Legislature, the reaction among legislators was just as combative. As a freshman Republican governor, Weld went head to head with the state's two most powerful Democrats, House Speaker Charles Flaherty and Senate President William Bulger. In a Reagan-like way, the governor took his message directly to voters. He held press conferences, accused the Democrats of being soft on the budget and part of the problem, and threatened to campaign against legislators who voted against his fiscal reforms.

During his first 100 days, Weld's confrontational strategy worked. He won a key legislative victory: the repeal of the extension of the sales tax on professional services, which if made permanent would have caused Fidelity Investments, one of the state's key employers, to relocate to a more business friendly state.

The repeal of the extension of the sales tax was a significant win for Weld. But to achieve deeper fiscal reforms, he strategically moved to a more conciliatory approach in dealing with the Legislature, where Democrats outnumbered Republicans by 3 to 1.

Weld often quoted the late Massachusetts Senator Paul Tsongas who said, "You never know where your next coalition is coming from". Egos abound in politics but Weld had a way of containing his. He continued to be hard on the problem -- fixing state government -- but reached across party lines to build support for his reforms among Democrats.

To keep communication channels open, Weld initiated weekly budget meetings with Flaherty and Bulger. In this way, he made his former foe, the Legislature, more of a partner in fixing Massachusetts. He and the Democratic leadership still sparred over legislative issues, often times intensely. But behind closed doors, the three men established an unforeseen friendship despite their ideological differences.

Weld did not get everything he asked for, and neither did the Democrats. But they did find enough common ground to help resuscitate Massachusetts during a very precarious time in the state's history.

Ultimately, Weld signed into law 19 tax cuts, balanced every budget without borrowing from Wall Street and otherwise improved the business and regulatory environment in Massachusetts. The state not only emerged from the fiscal crisis, but thrived. Unemployment, health care costs and welfare rolls went down while the state's bond rating and Stabilization Fund went up, benefiting all politicians in Massachusetts, not just Republicans.

Today, governors in Wisconsin, New Jersey and other cash-strapped states face similar problems that Weld grappled with in 1991 -- high unemployment, large budget deficits, credit rating downgrades, and impatient voters.

Politics as usual dictates that Republicans and Democrats have to win at each other's expense. But as Weld and the Legislature demonstrated in Massachusetts, it is possible for both parties to win, underscoring the importance of bipartisanship in getting through a fiscal crisis.

John Stimpson served as an aide to former Massachusetts Governor William Weld. He lives in New York City.