News From The Campaign Trail

Presidential candidates keep talking about Social Security. I keep getting e-mail suggesting that I should post something about what the candidates are saying. I have felt that the candidates' talk is nothing but sound and fury signifying nothing, but I am certainly posting about other things that are no more likely to matter, so let me write something, however reluctantly.

Bloomberg reports that Republican candidate Fred Thompson has been saying that we need to cut Social Security benefits. He also advocates private savings accounts, but has not said how private savings accounts may be achieved since he opposes a tax increase. His position sounds essentially the same as President Bush's position, which plays well with those who might vote in a Republican primary, but it is completely unworkable. If you want to carve private accounts out of the current tax rates, you are looking at massive cuts in current benefit payments and that is not going to happen, as Thompson knows well.

Democratic candidates John Edwards and Barack Obama have been proposing an increase in the cap on earnings subject to the FICA tax to bring the Social Security trust funds into long term balance. This position has been harshly criticized by Paul Krugman of the New York Times and others because it buys into the preposterous notion that Social Security is little more than a Ponzi scheme.

Where The Money Goes

The Social Security Administration has released its Performance and Accountability Report For Fiscal Year 2007. It includes this interesting information showing how Social Security's administrative budget is spent:

• Disability Insurance 24.5%
• Supplemental Security Income 29.8%
• Old Age and Survivors Insurance 29.6%
• Other (including Medicare) 16.1%

To understand what the Social Security Administration is, you need to ponder the fact that less than 30% of the agency's operating budget is spent administering old age and survivor's benefits.

The Real Effect Of The President's Social Security "Reform" Proposal

From the Wall Street Journal:

...[T]he [Wall Street Journal/Harris Interactive] survey shows most Americans are skeptical about whether Social Security will be available to them in retirement. While 56% of those ages 55 and older think it will be available, fewer than 20% of those younger than 55 believe they will be able to rely on Social Security.

Want To Study Anatomy?

Many of the people reading this blog are involved in one way or another with Social Security's disability programs. Basic medical knowledge is essential to those of us working in this field, yet few of us have received any systematic medical education.

Here is a chance to study medicine at its most basic level -- for free. The University of California at Berkeley has posted videos online of Professor Marian Diamond's course lectures on anatomy and physiology. I have not had a chance to watch much of it yet, but what I have watched seems fascinating. Just judging by the size of her class -- for a topic that most people would shy away from -- I would say that she has to be an excellent lecturer.

Fraud Alleged In New Jersey

From the Asbury Park Press:

MANASQUAN — A 61-year-old local man was indicted Wednesday on one count each of Social Security Disability fraud and theft of government property in connection with receiving approximately $384,980 in benefits he was not entitled to receive, according to a news release from the U.S. Attorney's Office, District of New Jersey.

Between about June 1989 and April 2007, Douglas Eugene Fittinger received income, including wages from employment and workers' compensation benefits, using a second Social Security number under the name David Fittinger.

Under his name in that same time period, Fittinger also received Disability Insurance Benefits payments on behalf of himself and his daughter, whose name is not being made public, said U.S. Attorney's Office spokesman J. Gregory Reinert.

What Appropriations Delays Mean

From the Free Lance-Star of Fredericksburg, VA:

Attorney Bruce Billman dreads the question every client asks.

They come to his office wanting help getting Social Security disability payments. And they all want to know: How long will it take?

"God, I hate looking them in the eye and telling them this," Billman said.

He doesn't have good news: On average, his clients will wait about a year to get a hearing to determine whether they'll get disability payments.

The backlog has long been considered a crisis by those in the field. A September report put out by the Social Security Administration noted, "For some, the long wait for their day in court leads to homelessness and the loss of family and friends. Sadly, people have died waiting for a hearing."

A $606 billion bill to fund education, health and labor programs may have relieved some of the long wait, said those familiar with the backlog. About $10 billion would have gone to Social Security for fiscal year 2008. But President Bush vetoed the bill Tuesday, saying it included too many pet projects and would lead to higher taxes. ...

One client of Bill Botts, executive director of Rappahannock Legal Aid, just got a letter saying it will be 14 months before her hearing.

Another of Botts' clients killed himself days after learning he would have to wait a year for his hearing.

And the wait time for a hearing in Fredericksburg area is much better than the national average.

Indictments In California

From the Sacramento Business Journal:

The owners of Our House Defines Art, an El Dorado Hills art gallery and framing business, were indicted Wednesday on eight counts of conspiracy to defraud the Social Security Administration.

A federal grand jury returned the indictment, which alleges Mary Margaret Donnelly, aka Mary Margaret Wittekind, and Michael Glen Donnelly, aka Michael Hubbs, falsely claimed to be disabled and not working from 2002 - 2007, when they were in fact working on their gallery. The indictment says the Cameron Park couple used $70,000 in disability benefits they were not entitled to.

No More Recess Appointments For Bush

America Blog reports that the Democratic Majority Leader in the Senate, Harry Reid, has decided to keep the Senate in session over the Thanksgiving holiday to prevent the President from making any recess appointments. I had suggested this idea about a year ago. If Reid had started doing this earlier, Andrew Biggs would not be Deputy Commissioner of Social Security.

Prefunding Con Job?

From the Atrios blog:

Someone showed up at the end of the Social Security thread to write this:

So math isn't one of your skills, then? The system goes into the red around 2017 - a decade from now. At that point, money that would otherwise flow towards discretionary programs will start bleeding to Social Security and Medicare. It will get worse over the course of the following 2 decades, until eventually, there won't be any money left for discretionary spending at all.

Essentially this is the prefunding con job. Since FICA revenues will cease to support general expenditures in the near future what we must do is... increase the FICA tax so it continues to support general expenditures. In other words, we need to increase the regressive payroll tax so that we don't need to raise other taxes. And we're doing it to "save" social security.

This is the con, laid out clearly for all to see. This has nothing to do with "saving Social security" and everything to do with increasing the regressivity of the tax code.

Someone had an idea for a lockbox, but the Village Elders decided that was a very silly idea.

An Important Point

From Tom Shoop at FedBlog:

Here's just a sampling of headlines from today's Washington Post:

• State Dept. Won't Order Diplomats to Iraq
• TSA Minimizes Failure to Detect Threats
• FEMA Accused Of Wasting More Katrina Funding
• Justice Dept. Conducting Criminal Probe of Baghdad Embassy Contracts

This is a pretty typical day for the newspaper. Can there be any doubt at this stage that management of federal operations is not just something that's worthy of the next president's attention, but the critical issue facing the country in the next few years? If recent history has taught us anything, it's that we should be judging our candidates on the basis of how well they will manage the critical functions of the federal government, which are literally a matter of life and death to Americans. And we should be holding their feet to the fire when they make cavalier policy proposals like not replacing half of federal employees who retire and threatening to cut health benefits for political appointees.

While presidential candidates like to focus on policy proposals, and political reporters remain obsessed with the who's-up-who's-down horse race aspects of the campaign, the critically important issue is whether the next president will form an effective team of appointees, make sure agencies have the capacity to perform the roles they've been assigned, and hold federal managers and executives accountable for results. This issue ought to be central to the campaign, and its barely on the periphery.