State governments have a vital interest in maximizing the work potential of their residents. As Arthur Brooks, former president of the American Enterprise Institute argued in a 2017 Foreign Affairs article, work brings a sense of dignity and “neededness” to people that is essential for human flourishing (Brooks 2017). As partners in administering federal safety net programs, states are given the flexibility to make policy choices that can influence participant employment decisions, and state leaders can use this flexibility to pursue policies aimed at reducing poverty through employment.
Wisconsin’s experience shows the benefits and pitfalls of this flexibility: the upside being state control over policies that affect employment among its residents and the downside experienced when state policy choices undermine the pro-work aspects of federal safety net programs.
The 2018 election returned the Wisconsin governor’s office to Democratic control for the first time since 2011. In his first year of office, Gov. Tony Evers reversed some key components of the state’s approach to serving low-income Wisconsin residents, namely the state’s use of the Supplemental Nutrition Assistance Program (SNAP) and the Temporary Assistance for Needy Families (TANF) program to promote work. Evers permanently delayed a policy passed by the Wisconsin Legislature in 2018 to require that parents of school-age children receiving SNAP participate in work or work activities or face reduced benefits.
The Evers administration also applied for and received a state waiver from the federal government to roll back work requirements for able-bodied adults without dependents (ABAWDs) who receive SNAP in six counties and 10 tribal areas. In addition, the administration has yet to implement the state 48-month time limit on TANF-related benefits passed by the Legislature in 2015.
The implications of these policy shifts for Wisconsin residents have yet to be realized, but they illustrate how state governments can utilize the authority given to them by the federal government to pursue state-level policy goals, even when those conflict with long-standing federal policies such as work requirements for SNAP recipients. This report describes how states can use three federal safety net programs to advance employment goals for low-income families and details how Wisconsin can better leverage these programs to return to a pro-work agenda for low-income families in the Badger State.
A central anti-poverty policy goal for the government is to provide assistance to low-income families to reduce material hardship, while not distorting the labor market decisions of work-capable adults. An effective approach is to pair employment supports, such as the earned income tax credit (EITC) and job training, with policies designed to make receipt of benefits contingent upon employment (Mead 2011).
As shown in this report, Wisconsin historically has balanced these aspects by offering a state EITC to working families with children (essentially boosting their incomes without negatively affecting work), while also enacting policies that set work expectations for recipients of other federal benefit programs. However, over the course of 2019, the state moved away from this approach.
State policymakers can return Wisconsin to a pro-work agenda by restoring funding for SNAP-related job training, which was passed by the state Legislature but vetoed by the governor in the 2019-2021 state budget; increasing the state EITC for families with one and two children; establishing a non-custodial parent EITC; improving the effectiveness of employment and training programs and creating better linkages between government and education and training institutions. At the same time, work expectations for SNAP recipients should be reinstated, and the 48-month time limit for Wisconsin Works (W-2) participants that was previously passed by the Legislature should be implemented.
Focusing state efforts on rewarding people for working while setting clear expectations for employment over government assistance will return Wisconsin to an employment-focused approach aimed at reducing poverty.