Feb 14, 2013

Astrue Speaks Out

     From an interview that outgoing Social Security Commissioner Michael Astrue gave to the Associated Press:
I think that Social Security is a gem. I think it is the most successful domestic program in the history of the United States government and it is fraying because of inattention to its problems. And I think it’s a shame that Washington cannot get its act together to look at Social Security in detail in isolation and say, What do we need to do? ...
Q: There are some in Congress who say only benefit cuts should be considered — no tax increases. Others say benefit cuts should be off the table. Where do you come down?
A: Nothing is going to happen if you establish preconditions for the conversation. I do think that for the people who simply want to tax more, you need to be very mindful of the fact that that tax will fall disproportionately on the younger generation and that if you’re not careful, that could be a huge economic drag. ...
Q: One of the few issues that the president and Republicans in Congress agree on is changing the way the government measures inflation. As you know, this would reduce the annual cost-of-living adjustment, or COLA, for Social Security recipients. Advocates for seniors hate the idea. They want bigger COLAs, not smaller ones. What do you think?
A: As a general matter I do think that the president and the Congress are right that before you start talking about increases in the retirement age and things like that it’s appropriate to try to have a conversation about what we might be able to do in terms of COLA adjustments.
Q: The age when retirees can receive full benefits is gradually increasing from 66 to 67. There are proposals to increase it gradually even more, perhaps as high as 70. What do you think of those proposals?
A: I think there’s some historical inevitability that we will move in that direction. How far, I don’t think is historically inevitable. Part of this we need to remember is not that the system is flawed or that there are evil people around here. I mean, we should celebrate a little bit of good news. Most of the pressure on the system comes from the fact that we’ve had great medical advances and people are living a lot longer than before.
Q: Social Security payroll taxes only apply to the first $ 113,700 of a worker’s wages. There have been proposals to increase this threshold or even eliminate it, applying the tax to all wages. What do you think of those ideas?
A: I think there’s some historic inevitability on at least some lifting of the (payroll tax) cap. I think that most politicians and I think most economists I’ve talked to generally think that that would have less of a negative impact on the economy than raising the rate itself.
Q: Applications for disability benefits increased dramatically when the economy went bad. Why did that happen?
A: I think a lot of people applied out of economic desperation. Very few of those people actually ended up getting benefits. If you look at the numbers, it’s one of the reasons why our approval rates have dropped dramatically in the last few years. ...
Q: The Association of Administrative Law Judges says that in order to reduce backlogs some judges are deciding more than 500 cases a year. Is that too many cases to do a thorough job on each one?
A: No, not at all. We set for the first time productivity standards in 2007. It was actually done by the chief judge, and it was done looking at best demonstrated practices of existing judges. At that point in time about 40 percent of the judges were doing 500 to 700 cases a year. And so that’s what we set as our goal, and that’s what it is, it’s a goal to shoot for. … Now, about 80 percent of the judges hit that goal.
      I wonder where Astrue goes from here. Think tank? Teaching? Writing poetry? All of these?
     By the way, I don't think there's any "historical inevitability" about raising full retirement age. In fact, I think that's quite unlikely. In retrospect, I'm amazed it happened the first time.


Victor Bobier said...

The Payroll Tax Cap didn't exist before the Reagan Administration and Social Security was healthy, remove the cap and Social Security will be healthy once more and there will be one less tax cut for the rich and well off to get away with.

Anonymous said...

If by this you mean the FICA tax limit, that's just not true. http://www.ssa.gov/oact/COLA/cbb.html#Series shows that there has been a ceiling on FICA wages since the start. Don't disagree it should be removed, but not true it's from Regan.

Anonymous said...

Please forgive me. I'm still trying to understand all this.. Im trying to figure out if there going to cut, get reed of ssd period? And if so when?

Anonymous said...

The 1983 Amendments eliminated the cap on the Medicare portion of FICA. The Social Security part remained indexed to the CPI.

Anonymous said...
This comment has been removed by a blog administrator.
Anonymous said...

Astrue is incorrect in asserting that the "productivity standard" of 500-700 cases per year was set by looking at best practices of ALJs. It was set by taking the number of pending hearing cases, divided by the number of ALJs -- not by considering how much time it actually takes to review evidence, hold a hearing, decide a case, read/edit/sign a decision.