State strategies for welfare reform: The Wisconsin story

Wisconsin is commonly cited as exemplar of the capability of states for reforming welfare. Wisconsin's welfare and caseload declined 22.5 percent between 1986 and 1994. I argue that the decline resulted from restriction of eligibility and benefits, a strong state economy, and large expenditures on welfare-to-work programs encouraged by an exceptional fiscal bargain with the federal government. Continued reduction of welfare utilization by means other than denying access are jeopardized by proposed changes in federal cost-sharing, a prospective state deficit, and the growing share of the caseload accounted for by residents of Milwaukee. Wisconsin Works, the state's plan for public assistance in a post-block grant world, continues benefit reduction and eligibility restriction but expands emphasis on employment. The special circumstances enjoyed by Wisconsin are unlikely to be duplicated elsewhere.