Laid-off workers and aging baby boomers are flooding Social Security's disability program with benefit claims, pushing the financially strapped system toward the brink of insolvency. ...
"It's primarily economic desperation," Social Security Commissioner Michael Astrue said in an interview. "People on the margins who get bad news in terms of a layoff and have no other place to go and they take a shot at disability," ...
The disability program "got into trouble first because of liberalization of eligibility standards in the 1980s," said Charles Blahous, one of the public trustees who oversee Social Security. "Then it got another shove into bigger trouble during the recent recession." ...
Last year, Social Security detected $1.4 billion in overpayments to disability beneficiaries, mostly to people who got jobs and no longer qualified, according to a recent report by the Government Accountability Office, the investigative arm of Congress.
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Aug 21, 2011
Fair And Balanced Reporting From The AP
From the Associated Press:
Direct from the Allsup public relations department?
ReplyDeleteWhat is this urban legend about the program being liberalized in the 1980s? I hear it repeatedly, and I have no idea what Mr. Blahous is talking about. Is he referring to the MIS on CDRs (which has nothing to do with the number of intital claims)?
ReplyDeleteWhen the fund runs out of assets in 2017, he means the numbers become zero, like numbers in your calculator.
ReplyDeleteEach dollar of trust fund principal and interest is paid for out of general revenues, the same way we pay for battleships.
The trust fund makes it no easier to pay benefits than if the trust fund did not exist.
The principal was loaned to the Treasury, and the interest was credited via debt.
That's why when interest is used to pay benefits, it takes general revenues to liquidate the debt.
If this was a disability insurer, they would simply liquidate principal and interest to pay benefits, rather than tap new monies, for the insurer's reserve is filled with real liquid assets.
Don Levit
To answer the second poster, the liberalization in the 80s usually refers to the 1985 mental impairment regs, not the MIS on CDRs.
ReplyDelete@ Don:
ReplyDeleteIf I was an insurer, and I had the option to pay benefits using either the interest or the principle on my assets, I would be the biggest $&#%tard in the world to use my principle.
And if the US Treasury won't honor the loans given to it by SSA, then SSA should cash out and invest somewhere else.