To date, the United States has failed to articulate a coherent and effective national rural development policy. The federal government, with a few exceptions, has focused primarily on a sector based policy that has only indirect, and at times weak, impact on rural America. State governments, once championed as the key to effective rural policy, have also failed to move beyond their traditional areas of focus in, education, corrections, Medicaid and other state services. No obvious forum or arena in which federal or state governments can carry out a national rural development policy other than as an afterthought of other policies and programs has developed, nor is one visible on the horizon. We believe national development can only come about through the aggregation of successful local development initiatives. The sheer diversity of rural America, from agricultural communities to manufacturing intensive places or retirement destinations, makes it difficult for states or the federal government to create and manage a coherent set of rural development policies. At the same time, many parts of rural America continue to suffer from economic and social disparities with the rest of the nation and have become increasingly dependent on federal and state transfer payment programs. National rural development policy has been unable to adequately take these and many other factors into account. Federal and state governments must rethink their role in rural development policy. These levels of government, rather than creating and managing large government programs, can provide support through block grants, fiscal and regulatory flexibility and technical assistance. A new rural development policy must accept that the progress is incremental and that change must be based on a broad coalition of support. This means that we have to move from top-down to bottom-up approaches. Local governments represent an important piece of the rural policy puzzle and the revival of rural America. Rural cities and counties are best positioned to address the needs of rural America, but have been hampered in the past due to state restrictions on revenue raising capacity and expenditure limitations. Many analysts now believe that rural development policy can be carried out more effectively by local governments enacting positive changes in their community to revive economies and reduce disparities. The large number of local governments and overlapping jurisdictions implies that rural city-county partnerships must be the foundation of nationally-based rural development policy.