The New Wisconsin Idea
Reinventing Public Compassion for the 21st Century
Overview of the Book
It was a heady time for social policy in America, and the state of Wisconsin was in many respects the engine driving the train. A former president, reflecting on the vast number of reform initiatives, said the “state has become literally a laboratory for wise experimentation legislation aiming to secure the social and political betterment of the people as a whole.” He added that, “in Wisconsin there has been a successful effort to redeem the promises by performances, and to reduce theories into practice.”
It may come as a surprise that the president who offered this assessment was Theodore Roosevelt, and the object of TR’s enthusiasm was the reforming efforts of Governor Robert La Follette, whose Progressive political movement at the dawn of the 20th century sparked a new era of state-level innovation. “Fighting Bob” La Follette’s accomplishments featured legislation weaving the most reliable safety net for the poor and vulnerable citizens including the nation’s first unemployment and worker’s compensation systems. These measures had a profound influence on the future direction of national, and even international, social policy.
Tommy Thompson served as Wisconsin’s governor as the 20th century turned into the 21st. Like his progressive predecessor, he introduced proposals that sought to improve the lot of his state’s poor and it also drew praise from Washington. President Bill Clinton used one of his weekly radio addresses in May 1996 to laud Thompson’s Wisconsin Works proposal, calling it “a sweeping welfare reform plan, one of the boldest yet attempted in America.”
However, praise from Washington was not Thompson’s objective. Instead, he followed La Follette in being more interested in the devolution of power from Washington to Madison, and from Madison to the county seats across Wisconsin. Beyond government jurisdiction, he wanted to share power with each citizen in the state and the private nonprofits that far exceed government’s ability to help the poor help themselves.
This partnership between the government and its people is emblematic of what has become known as “The Wisconsin Idea.” There are many interpretations of this theme, but simply put, it is the application of intellectual resources toward the state’s most stubborn problems and pressing needs. The term was coined during La Follette’s governorship, and it gave image to the effective partnership he had established with his alma mater, the University of Wisconsin.
Wisconsin is unique in that its power centers –the State Capitol and University of Wisconsin campus—share an isthmus in downtown Madison, joined on either end of the pedestrian State Street. But it was their shared concern for problem-solving that made the partnership the envy of other states, many of whose leaders traveled to Madison to investigate the process firsthand.
A popular “product” offered to these visitors during the La Follette years was model legislation held by Charles McCarthy, who is widely credited with coming up the “Wisconsin Idea” moniker. He captured its history in a book by the same name and also created the professionally staffed Legislative Reference Library, “which assembled best information from all sources for political consideration.” This expedited the transfer of Wisconsin’s reforms to other states and national policy.
In 1934, President Franklin Delano Roosevelt appointed University of Wisconsin professor Edwin Witte as the Executive Director of the newly created President’s Committee on Economic Security in 1934. Congress had ordered the president to develop a comprehensive economic security program to be presented at the beginning of the 1935 session. Dr. Witte was recommended to lead this effort by FDR’s secretary of labor secretary, Frances Perkins, and he brought with him a trusted set of advisors from Wisconsin.
Dr. Witte and his team began work in July of 1934, and he presented their report to President Roosevelt the day before Christmas. The bill was then drafted in early ’35, followed by congressional action, wherein the term “economic security” was replaced with “social security.” President Roosevelt signed the Social Security Act into law in August 1935, just over one year from the time they began work. The term “social security” quickly became popular and in 1940 the International Labor Office issued an important report called “Approaches to Social Security” making it universally a universally accepted concept.
As we know all too well, FDR’s warnings of welfare becoming a narcotic if extended beyond the temporary needs became all too apparent as America escaped the Depression and a divide began to take shape between the working and nonworking populations. By mid-century, the federal government assumed near-total control of social welfare policies giving rise to a virtual government monopoly on care-giving in America. This was a far cry from the “power to the people” mantra of the Progressives. In response, there came an interesting conjunction of left-leaning community organizers, who sought to retain power in the hands of neighborhood residents, and right-leaning policymakers, who were interested in devolution to the states and a return to civil society.
By the 1990s, a near-universal disdain for America’s welfare state had emerged. But while critics of all shapes and sizes took form, agreement could not be reached on a model to replace the failed system. It was in this void that Thompson provided a “progressive reprisal” of the Wisconsin Idea. His first term in office, which began in 1987, was defined by efforts to mitigate the damages caused by unintentionally harmful Great Society policies of Lyndon Johnson. Following re-election in 1990, he partnered with the Wisconsin legislature to adopt legislation making Wisconsin the first state in the nation intent on replacing the Aid to Families with Dependent Children (AFDC) program with a new social contract.
This book presents the comprehensive account of how Wisconsin’s welfare replacement program was birthed from the initial, incremental reform activity to its eventual acceptance as a national reform package and international reform blueprint. In many respects, this book is a virtual user’s guide to Wisconsin welfare reform.
As Governors La Follette and Thompson understood, the sharing of power between Washington and the states must be carefully, and continuously, balanced. Even more important, efforts to help the poor help themselves must be assiduously pursued. Changing economic conditions are reason enough to remain flexible, but the more delicate nature of the evolving needs of each individual requires an especially nimble care-giving apparatus. The best way to create and maintain such a system is through vibrant public-private partnerships, a mix of empowerment and charity, an openness to learning from other states (and other countries, for that matter), and a willingness to put theory to the test in the real world.
These are among the reasons this book was written. Thompson’s reforms were so successful that the state’s caseload plummeted by nearly 90 percent while poverty declined and employment escalated. The Wisconsin model ignited a reform movement that resulted in a new national law being adopted based on many of its tenets and its ideas continue to translate into global reform efforts most notably the United Kingdom.
This book was written by my welfare policy team at the Hudson Institute. Some of us were privileged to operate alongside Governor Thompson’s administration as members of Hudson’s field office in Madison. Others were external advisors located in Hudson’s Indianapolis or Washington offices. Together, we were given access to the principal policymakers, leading academics and source material that contributed to the making of the Wisconsin Works model.
Chapter 1 captures Tommy Thompson’s first term as Wisconsin governor and the Reagan administration’s attempt to encourage state experimentation in welfare policy. Thompson won office on the strength of twin campaign goals of economic development and welfare reform. The two were inextricably linked and made possible through Thompson’s artful continuation of his predecessor’s welfare experiments and aggressive new attempts to mitigate the damages of the AFDC program’s unintended consequences.
Chapter 2 introduces Thompson’s second term efforts to move from necessary but insufficient incremental reforms to a systematic reform model. As former welfare reforming governor Bill Clinton campaigned for the presidency on a promise to “end welfare as we know it,” Thompson beat him to the punch by testing Work Not Welfare in two counties.
Chapter 3 gives a detailed and authoritative account of the research and policy development process that resulted in the Wisconsin Works program design. This was a highly collaborative process that was driving by a team of Wisconsin officials possessing national expertise as well as active participation by a bipartisan set of state legislators and university scholars representing varying ideological perspectives and subject matter expertise.
Chapter 4 captures the fascinating national politics that coincided with the negotiation process necessary for Wisconsin Works state law to become approved for federal funding. President Clinton’s own efforts to reform welfare proved unsuccessful following his 1992 election and then the Republicans won a congressional majority in 1994. During this time, Thompson and a growing number of governors were successful rewriting welfare laws in their states and building public confidence in Wisconsin-style welfare reform. Clinton ultimately endorsed the Wisconsin model and signed the 1996 Republican welfare reform bill.
Chapter 5 moves from the drama of national politics to the nuts and bolts of program administration. No matter how big the ideas, all reforms are proven successful or not based on the quality of its implementation. This chapter assesses Wisconsin Works from a view from Milwaukee’s streets.
Chapter 6 illustrates that reform is not an event but rather a living process. Wisconsin ensured that its welfare reforms would be continuously improved by the inauguration of a Management and Evaluation Project that provided an interface between state policymakers and the national research community. Functions ranged from providing technical expertise on research methodology to catalyzing foundation’s investment in high impact research projects.
Chapter 7 considers welfare reform as a transatlantic trade. While the Wisconsin model was not replicated in full, its core concepts—work requirements, job centers and performance contracting—were exported to places such as Germany, the Netherlands, Israel and the United Kingdom.
In recognition of the twentieth anniversary of the adoption of Wisconsin Works in 2013, the Sagamore Institute hosted an event at the National Press Club featuring former Governor Tommy Thompson and British welfare chief Iain Duncan Smith. Their joint statement and individual remarks are included the Afterword. Thompson largely reflects on why he pursued such fundamental reforms and Smith forcefully makes the case for the next round of reforms necessary for the 21st century.