Nov 5, 2014

What Will The Election Results Mean For Social Security?

     My track record on predictions isn't good but I'll go ahead anyway knowing that my readers can respond with their own predictions.
     First, nothing will happen to Social Security's retirement and survivor benefits. Nothing can possibly touch them either now or in the future.
     Second, Carolyn Colvin won't be confirmed as Commissioner. Senate Democrats will try to confirm judges mostly in the lame duck session. There's no urgency to the Colvin nomination for Democrats since she remains on as Acting Commissioner until a new Commissioner is confirmed.
     Third, Republicans will hold more hearings trying to expose waste, fraud and abuse in Social Security's disability programs. I don't think they're going to find much to expose. There are many claims and many claimants so there's always something but I don't think there's anything major out there. House Republicans have been imploring Social Security's Inspector General for the last four years to please, please find something juicy. You can make your own judgment but I don't think what has been found amounts to much and I doubt there's much more to find. The low hanging fruit has already been plucked.
     Fourth, House Republicans will try to draft some legislation to deal with the possible exhaustion of the Disability Trust Fund but I don't think their heart will be in it. Cutting Social Security isn't popular, even when you're talking about disability benefits. They also have a technical problem. Republicans with real knowledge and experience with Social Security benefits are almost nonexistent. My guess is that if they can possibly delay this to 2017, they will and I think they can delay it so that the next Congress will have to deal with it. Nevertheless, pressure will remain on the Social Security Administration to do something to "save" the Disability Trust Fund so I expect some harsh regulatory proposals to try to propitiate the Republicans. That's pointless since Congressional Republicans don't want to be propitiated but the agency never learns.
     Fifth, I have no idea what sort of operating budget the agency will get. Probably, it won't be significantly higher any time soon but I'm not sure it will be cut. I don't think the GOP wants the blame for poor service at Social Security. My impression is that Congressional Republicans would like to hold hearings about poor service at Social Security, much like the hearings on service at the Department of Veterans Affairs, but again they have concern that the blame will be placed on them. The hearings on service at VA have resulted in a sharply higher operating budget for VA. I doubt that result is in the picture for Social Security. 


Anonymous said...

That looks like a pretty solid prognostication, Charles.

Anonymous said...

My concern is with your fourth point: how will Republicans deal with the exhaustion of the disability trust fund? Instead of just making the simple and noncontroversial accounting fix between the two trust funds, I believe they'll want something in return first. What could this be? You're probably right that they'll likely punt to the next Congress, especially with claims and payment rates dropping. However, I bet they'll first float out some proposals that will cause much hand wringing.

My biggest concern is one that you don't mention: another government shutdown. We already saw what the last shutdown did to Social Security in terms of increased backlogs and lost productivity. It was also damaging to every SSD law firm I know that had its fees stop or slow dramatically before, during and immediately after the shutdown. It took months to recover and nobody want to go through that again.

Anonymous said...

They are going to solve the disability "problem" by trying to contract out ODAR functions. The Carlyle Group already has their bib on and will belly up to the bar in short form.

Congress is going to try to significantly reduce children's benefits.

They will agree to slightly raise the cap for OASDI, I would say no more than for income of $125, I wanted to say $150K but that is pipe dreaming.But they will agree to raise the cap most likely with a correlating in raising the highest benefit amount. Counter intuitive? Not really, it is an easy give away and even their "base" is in favor of preserving Social Security retirement, disability is somewhat more easy to pick on.

This Congress will have nothing to lose by forcing a shutdown but may be reluctant to do so because o the backlash from last time.

The bright side (if you can call it that), is that it looks like more main stream republicans won, not the Tea Party republicans. The down side of that is that they may not be extreme enough to screw themselves out of 2016.

The election is over, the election is just beginning.

Anonymous said...

The likely playbook:

1. Flood the media with a manufactured crisis: "Oh my word the Social Security Disability fund is about to run out of money!" 2. Slick media campaign and congressional hearings carefully crafted to make it seem like there is much more fraud in the disability system than there really is. 3. "Aw shucks, looks like we have no choice but to cut benefits to those disabled people, because the fund is about out of money anyway." 4. Ignore anyone who points out that the whole problem could be fixed with no disability benefit cuts, by simple reallocation or by other modest changes that the public would have no problem accepting.

Get ready for congressional hearings with agenda-driven "experts" hostile to the disability program, shoddy research reports, and plenty of misleading news coverage.

Anonymous said...

Interested on who would be the next SSA commissioner if not Colvin?

Colvin seems to have extensive experience in the SSA. I figured she would be fairly liberal for claimants. Kind of shame she loses the fulltime position because of some bogus midterm elections.

You blogged on 8-3-14 about the nominee for Deputy SSA commissioner being Andrew LaMont Eanes. This person does not seem to fit anything in the SSA. He basically was a CEO of Dynis from 2011-12 and was VP of a thing called Agile Government Services Inc. since 2012. This person seemed like a political favor to Obama (like a former frat buddy).

So for my vote, yes on Colvin no on Eanes. I guess both will be out right?

Anonymous said...

Colvin could be acting without confirmation until a new President is elected. The new President could choose someone else to fill out the remaining two years of the Commissioner's term.

Mr. Eanes has already arrived at SSA - hired as a senior advisor to Ms. Colvin.

Anonymous said...

It spells BIG DO DO.

If they gain the presidency i may start sleeping with a night light at night. I'm afraid very afraid.

Anonymous said...


"However, I bet they'll first float out some proposals that will cause much hand wringing."

I agree. Any time one party gets what they perceive to be the upper hand, the extremists in that party ramp up their demands. The politicians in their pockets will give them voice. In this case, that means the extreme right will use its influence to float more draconian proposals to cut government benefits to the poor.

Anonymous said...

You may see a change in the way the COLA is calculated; a switch to the Chained CPI.