Uncle Sam has expanded his reach into the nation's schools during the last five decades. Those forays frequently have been motivated by concerns over equity and a growing interest in promoting academic excellence. An overall working assumption has been that federal prodding and assistance could help encourage states and localities to better meet these two overarching needs. As we move toward reauthorization of the Elementary and Secondary Education Act (ESEA), recognizing the strengths and weaknesses of their position can help federal policy makers make the most of their capabilities and, in the process, help states and localities make the most of theirs.