Final answer:
The effect of the policy of devolution on states during the age of Reagan led to states gaining more autonomy in policymaking, as they took on more responsibilities traditionally managed by the federal government. Despite this, the Reagan administration faced opposition that curtailed the full realization of new federalism.
Step-by-step explanation:
The policy of devolution during the Reagan administration had the effect of shifting power and responsibility towards state governments, leading to states gaining more autonomy in policy-making. This shift is consistent with the principles of new federalism, introduced by President Nixon and continued by President Reagan. The states began to handle more responsibilities that had been traditionally administered by the federal government, such as welfare programs. Devolution allowed states to become more active in numerous policy areas, making them prime targets for lobbying efforts by interests seeking to influence policy.
However, it's important to note that Reagan's agenda of devolution met with opposition which prevented him from fully implementing his vision. Some federal programs were still controlled centrally, and while general revenue sharing ended in 1986, states were given substantial flexibility in the implementation of federal social welfare programs. The Omnibus Budget Reconciliation Act of 1981 was a significant step toward new federalism, giving state and local governments greater discretion in using federal funds.