WELFARE REFORM CHANGES SYSTEM (SECOND IN A THREE-PART SERIES)

JEFFERSON CITY -- When Wisconsin Gov. Tommy Thompson unveiled the final phase of Wisconsin's dramatic welfare reform program, he told the state's citizens: "W-2 means the end of the automatic welfare check. We believe that everyone is capable of some level of work, and W-2 will help participants move directly into work at the earliest possible time. This comprehensive replacement for welfare will demand more of participants, but in the long run it will provide independence and a future."

Not everyone subscribes to Thompson's rosy scenario, although generally there is agreement about the problems that exist with the present system. Most see the current programs as a way of life for too many, with no time limits on AFDC and with 65 percent of recipients spending eight or more years on welfare.

The Wisconsin plan attacks another complaint: the present welfare rules do not require work. Current AFDC cash payments are a straight transfer of income, with no reciprocal obligation, and the existent JOBS program emphasizes training but not employment.

A third component that has received criticism from many is that welfare provides the wrong incentives and disincentives. Recipients are under no obligation to leave welfare and businesses are not encouraged to help reduce welfare dependency. Under the present system, government becomes the other parent in single-parent households, while socially undesirable behavior, such as having additional children without means of support, is rewarded.

There are seven key features of the Thompson reform package, and briefly stated, they are:

-- No automatic welfare check.

-- All parents are required to work to support their families.

-- The system will help find the best self-sufficiency alternative, and there will be a place for everybody, regardless of capabilities.

-- Opportunities for advancement are provided through the self-sufficiency ladder.

-- Child care and health care will be available to all low-income families who need it to work.

-- Child support payments will go to whom they belong: working custodial parents and their children.

-- A unified delivery system will be funded based on performance.

When introducing the work-related portions of the Wisconsin plan, Gov. Thompson told audiences: "Work fulfills a basic human need -- it connects individuals to society and its values. By providing income without the need for work, welfare isolates recipients from society. Such a destructive influence can end only if work and income are rejoined."

Thompson sought to implement this phase of W-2 with the following principles:

-- For those who can work, only work should pay.

-- W-2 assumes everybody is able to work within their abilities.

-- Families are society's way of nurturing and protecting children, all policies must be judged in light of how well these policies strengthen the responsibility of both parents to care for their children.

-- The new system's fairness will be gauged by comparison and is designed to reinforce behavior that leads to independence and self-sufficiency.

-- Individuals are part of various communities of people and places. W-2 will operate in ways that enhance the way communities support individual efforts to achieve self-sufficiency.

-- The new system should provide only as much service as an eligible individual asks for or needs. Many individuals will do better with just a light touch.

-- W-2 objectives are best achieved by working with the most effective providers and by relying on market and performance mechanisms.

As can be determined from the basic philosophy and goals of the Wisconsin plan, the emphasis is on work, extending it more broadly than is the case in most other state plans at present. Stating that W-2 has "a place for everybody," Gov. Thompson has nevertheless restricted assistance without effort and work by recipients. A state welfare official notes that W-2 will end all cash payments without recipient work, but it will provide work opportunities for parents of all capabilities. The official said the program will build on these capabilities to increase the financial independence of parents and their families.

Families consisting of custodial parents and their children age 18 or younger, with incomes below 115 percent of poverty and with low assets, are eligible for all W-2 services. Non-custodial parents and pregnant women are eligible for certain services. W-2 health care and child care are available to families with low incomes and with low assets.

Next: Wisconsin's 16 steps to welfare reform.