WHEN we speak of the welfare state and its problems, we refer to something much larger than just social programs meant for the poor. Today, all Americans are “on welfare” in the sense that they claim benefits they have not directly earned from government programs. And since Social Security, Medicare, and other programs that cover the general population are mainly responsible for the government’s fiscal problems, we must say that the welfare state and its crisis are solidly middle-class. Yet the most troubling problems of the welfare state do concern “welfare” in the narrower sense of programs meant for the needy. I have in mind here Aid to Families with Dependent Children (AFDC), other welfare programs, food stamps, Medicaid, and a number of federal compensatory education and training programs. All were instituted or expanded during the Great Society period of the 1960’s and early 1970’s. All are carried out at federal behest by state, local, or nonprofit agencies mostly using federal money.