The sexiest governor alive (though you wouldn’t know it looking at him) is John Engler of Michigan, short-listed by the press for the vice presidential nomination after Colin Powell seemed to demur. With the GOP’s Southern base, Dole needs just one big Midwestern state to reduce Bill Clinton’s Electoral College margin for error to zero. Ohio’s popular Gov. George Voinovich is much closer to Dole, but viewed as “moderate” by party regulars–the same kiss of death applied to New Jersey Gov. Christine Whitman. Engler, 47, is Roman Catholic (a key swing constituency), Buchananesque on abortion and uninspiring enough that he wouldn’t overshadow Dole. He has cute 16-month-old triplets whose photographs are constantly updated on his Web site. He annoyed Dole by staying neutral too long and letting his top aide run Lamar Alexander’s national campaign. But that’s not fatal. He flunked his Vietnam draft physical by being two pounds overweight. That could hurt. On the other hand, fat people vote, too.

In any event, the political wise guys are in heat over Engler, which means, of course, that Dole will probably pick someone else. The early money is rarely right. But whatever happens, Engler represents state-of-the-art GOP governance. In terms of getting what he wants, he is phenomenally successful. After winning by a hair in 1990, his popularity sank to 18 percent under charges of “heartlessness.” But he stuck with his budget-cutting, tough-on-welfare program and was re-elected with 61 percent in 1994. Now his numbers are even higher, and he dominates the state. Engler did this not as a conservative ideologue, but by liberal experimentation–if liberal means using government to advance social goals. He’s innovative, practical and cunning.

And the man is a walking advertisement against term limits. Elected to the legislature at 22, he has never held a job outside politics. Knowing where the levers are, Engler has managed to cut taxes, expand preschool and preventive-health spending and overhaul the criminal-justice system. He reduced inequity between school districts by transferring funding from onerous property taxes (which were cut, on average, by a third to a half) to an increased but still reasonable sales tax, a huge change.

Obviously, a healthy auto industry and a rebounding national economy made all this easier. The same is true for his welfare reductions. But Engler also skillfully structured his initiatives to reward work. He’d even like Washington to let him make food stamps convertible to cash for low-income workers. Less patronizing. Fosters independence. (He’s renaming the Michigan department of social services the Family Independence Agency.) All told, more than 70 percent of welfare mothers have signed a contract committing them to work, volunteer or (in the case of minors) finish school in exchange for benefits; more than 80,000 have been moved off the rolls and into jobs, bringing the caseload to its lowest point since the early 1970s. Earlier, able-bodied adults who are not parents were thrown off welfare altogether. At first, Engler was condemned for being “mean-spirited.” Today there’s barely a peep.

But when I visited Engler last week, I was struck by his disingenuousness on the national welfare plan he helped fashion. Engler has done good work crafting a compromise that would let states devise their own plans–and that Clinton could sign. He even came around to Clinton’s view on the need for more child care. But now, sniffing a place on the ticket, Engler has turned surprisingly pessimistic about welfare reform. “The poverty industry doesn’t want to change the system,” he says, referring to Democratic constituencies. Clinton talks a good game, he says, yet wants to demagogue Republicans and run on “fear.”

Maybe so. But the White House has hinted that Clinton would sign the governors’ welfare overhaul as long as it wasn’t attached to a plan to turn Medicaid into block grants. What does Engler say to separating the two? “I’d say, “See you at the polls’,” Engler replies. How partisan of you, governor. Yes, welfare and Medicaid (the latter alone accounts for about a third of many state budgets) are related and should ideally be addressed together. But that’s not doable this year. Engler’s refusal to take a historic half a loaf suggests that the Republicans’ real priority is not more flexibility on welfare but bashing Clinton for not fulfilling his promise to “end welfare as we know it.”

When times get tough, John Engler and his colleagues will all look worse. Many will live to regret asking for more responsibility and less money from the Feds. In the meantime, both Dole and Clinton need to spell out which duties they believe are federal, which are state, and why. This may make less compelling copy than “character” or “charisma.” But it will help tell us whether in the next century we’ll be living with one Washington–or 50.