Wisconsin Steps Into the Unknown

More draconian than any welfare reform plan now being debated, Gov. Tommy Thompson’s Wisconsin Works program is now state law.

Wisconsin Works means what it says: No current welfare recipient will receive cash benefits without working, typically full-time. Participation is mandated without consideration for employability, age or number of children at home, or whether the clients (or the children) are able-bodied.

Mandated work will be done in one of four “tiers.” At the top are regular jobs obtained through job search; below this level are subsidized jobs, public service jobs and (for the least employable) “effort” of some sort defined as work, such as caring for one’s own child or being in a training program. Steering participants into the right track will be the task of a new breed of welfare workers called financial and employment planners (FEPs). Child care and health subsidies will be provided, but participants will have to pay part of the cost, on a sliding scale. And, finally, a tight time limit of five years of participation is imposed; after that, Wisconsin’s traditionally generous safety net will be no more. And there is no mechanism for appeal.

While this bold and well-intentioned welfare reform addresses difficult and deep-seated problems, it is also a leap into the unknown. As the plan emerges into action, it will be difficult to avoid hard questions about its feasibility, its effects and its cost to Wisconsin taxpayers.

* How hard is it to find jobs for welfare recipients? While the Wisconsin reform ends welfare by mandating work, all of the evidence from two decades of community work experience indicates that welfare recipients cannot easily be placed in private-sector, unsubsidized jobs. Nothing we know about the qualifications, work experience and family circumstances of Wisconsin recipients supports the idea that, within a short period of time and with no additional training, more than half of them can find full-time work, public or private, as the program requires. The other side of this too optimistic premise is that the program allocates too few clients to the two lowest (and most costly) job categories, community service and “transition jobs.”

These allocations are no more than guesswork, yet they may seem reasonable to some, given Wisconsin’s success in reducing the welfare caseload. However, the easy reductions already have been made, primarily outside Milwaukee, the state’s largest city. Further reductions must come from within Milwaukee, where recipients and other poor families are concentrated in deteriorated neighborhoods, far from job opportunities.

If it turns out that recipients cannot secure standard private-sector jobs at anything like the rate that the state estimates, the costs of the reform will balloon as recipients are shifted to tax-subsidized employment. Already, the $1 billion in estimated state taxpayer costs exceeds spending on the current system.

Moreover, if the economy falters and private-sector unemployment rates rise, taxpayer costs will also grow. The proposal is silent on the liability of the state and its citizens should the estimated costs of the program be greatly understated. Public budgets will surely take a hit. Or, if a cap on spending is imposed, poor families will take the hit.

* Can the plan be effectively implemented on the timetable proposed? The new program is supposed to be up and running in all counties of the state by a year or 18 months from now. This is a Herculean task. In a state with fewer than 400,000 retail trade workers (a prime entry-level field) and fewer than 2,000 working in community service or on-the-job training, the plan promises work for about 60,000 welfare clients, half of them in community service jobs.

The linchpin of a successful work-oriented program is the FEP counselor. FEPs must assist participants in moving along the job ladder, help them deal with health care and child care and work with private- and public-sector employers in arranging jobs. Current welfare caseworkers--primarily benefit and eligibility administrators without FEP training and skills--are expected to bear the lion’s share of those new tasks.

Embarking on this program in haste without adequate staffing by personnel with the required skills is a recipe for trouble.

* Is the Wisconsin plan really a work incentive program? It places enormous emphasis on work as the route to self-sufficiency. But those recipients who move up the job ladder toward regular private-sector jobs will, at the same time, need to pay more for child care and health insurance benefits. In some cases, every dollar of additional earnings will be offset by the loss of at least a dollar of other support. So they won’t be much better off. Cries of “foul” would ring out if the earnings of those with far greater ability to pay were taxed at such rates.

* How will we know if the program works? The Wisconsin plan is both extremely ambitious in its goals and silent on the need to evaluate its results. Without careful evaluation, we will not be able reliably to assess whether it accomplishes the intended outcome. Despite the difficulty of evaluation, surely any political leader would want to give taxpayers an accurate account of what is happening to the lives and living conditions of the state’s poorest citizens--their work and earnings, their health and the health and well-being of their children.