The Sage Of Indianapolis

Stephen Goldsmith has discovered a new gadget: a headset for his mobile phone. He slips the phone in his pocket and straps on the earphone. That leaves his arms free to gesture emphatically, something he does all the time as George W. Bush's chief domestic-policy adviser. In Indianapolis recently, where he is about to step down after two terms as mayor, Goldsmith was touring a new housing development in an inner-city neighborhood when he took a call from a Bush staffer back in Austin, Texas, working on a speech. Standing on a weed-infested corner that once saw its share of drug deals, the mayor began talking--and waving his arms.

To Goldsmith, this was a perfect backdrop for dickering over the details of the speech. Wiry and intense, he is a reform-minded conservative who believes that government still has a role, particularly if it paves the way for individual initiative. The housing project is a good example: the city donated the land for private development and encouraged local businesses to guarantee loans. "We cannot abandon these neighborhoods," the mayor says. "The ever-increasing concentric circles of poverty are not only morally wrong, they can be dangerous." Bush has recently spouted similar language, as if Goldsmith has a direct line to Bush's brain.

Goldsmith is the intellectual point man on issues Bush really cares about, like charter schools and partnerships between government and faith-based charities to revitalize urban neighborhoods. The 53-year-old former prosecutor has been called the "most creative mayor in America" by fans who like his dry wit and blunt style, and "ambition in a suit" by detractors who find him aloof. Goldsmith is the detail-oriented executor of Bush's "compassionate conservatism" and the cerebral cortex of an extensive domestic brain trust known as "the Indy 200."

Bush first bonded with Goldsmith in 1997 when the mayor was touring Texas for his book, "The Twenty-First Century City." Afterward George W invited him to the governor's mansion and they got so immersed in a discussion of public-private partnerships that the mayor ended up staying the night. No one would ever accuse Bush of being a policy wonk, nor would they ever call Goldsmith a good ole boy. Bush works a room by flirting with women and men alike. Goldsmith sometimes seems pained by smiling. Bush freely admits that his reading preferences run to the likes of Field & Stream. Goldsmith reads tomes like "Reengineering the Corporation," which he sent to his top staff, along with articles from Reason magazine.

Indianapolis is now a mecca for urban innovation. When Goldsmith took office in 1991, he made public employees compete with private contractors for city services like trash collection. The $400 million savings helped rebuild the city. Downtown India-no-place, as some jokingly call it, is undergoing a renaissance and now boasts a trendy trattoria, a sushi bar and a Starbucks. Goldsmith is in sync: he created a city Web site where citizens can report abandoned cars, request a permit or critique the city budget online.

Thousands of city officials and policy wonks have visited Indianapolis during Goldsmith's eight years as mayor, and he now has one of the best Rolodexes in the business. So when Bush asked Goldsmith last February to get him the "best and boldest thinkers who agreed with his principles," he was calling on people he already knew. Goldsmith organized small discussions for the governor. Bush asked the questions, but Goldsmith was the impresario. Last week Goldsmith sent his typical 5 a.m. e-mails to some of the Indy 200, refining points for Bush's campaign debate this week. Goldsmith won't be wired to Bush while the candidate is on stage, but he might as well be.