At the 1987 Winter Meeting of the National Governors' Association, the Governors adopted a policy program calling for a major reorientation and reform of the nation's welfare system. This document addresses how the welfare system can be reformed to better encourage the self-sufficiency of recipients and reduce their dependency, and how to use savings from those who leave the welfare rolls to extend eligibility to intact families and assure a more adequate standard of assistance where current benefits are low. Suggestions for designing and implementing a reform program are offered in the following areas: (1) the role of the governor; (2) child support; (3) selection of programs and target populations; (4) mobilization of program resources; (5) establishment and management of individual plans for self-sufficiency; (6) management of the delivery of services; (7) intergovernmental issues; and (8) medical care. The report concludes with a discussion of the factors to be considered in working out a cost/benefit analysis of alternative strategies. (BJV)