Social Security's Operating Budget -- Is It Lockheed Martin Versus Having Enough Employees To Get The Work Done?

President Bush's budget for fiscal year (FY) 2008 is due out today. This may be a good time to look back at President Bush's budget for (FY) 2006, which was never enacted. It called for a 4.2% increase in Social Security's funding, which is above the rate of inflation, yet that budget called for a decrease in the number of full time equivalent (FTEs) employees at Social Security from 63,998 to 62,036, a 3% decrease. If Social Security was to get more money even after inflation, why would they have to cut the workforce significantly?

A possible explanation for a budget increase but a staff decrease might be the five year $124 million contract awarded to Lockheed Martin for scanning documents and the $525 million contract awarded to Lockheed Martin for information technology (IT) modernization, as well as contracts awarded to other corporations. If there is another explanation, I would be interested in hearing it.

The actual budget that Social Security is getting in FY 2007 is a good deal less than what the President had proposed, but that does not mean that the contractors get less. Apparently, it just means a greater reduction in staff for Social Security. That is why Social Security is in the midst of a year long hiring freeze and was under the threat of a staff furlough until recently.

I do not mean to suggest that Social Security did not computer system modernization. They did and still do, but if your trains are not running on time, in addition to looking at how your trains are scheduled, you have to look at the basic question of whether you have enough trains. Spending gobs of money on fancy software will not make your trains run on time if there are not enough trains to begin with.

In considering the FY 2008 budget, Congress will have to consider not merely the gross amount of Social Security's operating budget, but how that money is to be spent. This should include some serious hearings about the value added by outside contractors and how much staffing Social Security needs to get its work done.

Former Social Security Employee Sent To Prison For Social Security Fraud

The Detroit News reports that Bethann Shauntee, a former Social Security employee, has been sentenced to 12 months in prison for fraudulently obtaining $21,418.20 in Social Security benefits. Exactly how she did this is unclear. The newspaper article says only that while working for Social Security she diverted Social Security disability checks to a co-defendant.

Treasury Secretary Soldiers On

The last person in America who believes that there is a possibility for major "reform" in Social Security in the next two years may be Henry Paulson, the Treasury Secretary, but even he seems to be losing hope, as this excerpt from a Reuters article indicates:

U.S. Treasury Secretary Henry Paulson conceded on Friday that chances were slim for agreeing on a way to reform Social Security financing but said he would keep trying to find bipartisan support for

"There's not a high degree of likelihood. I'm not naive, given how politically contentious this is, that we'll get this done," Paulson said in an interview on CNBC Television.

But note Paulson's tone in this article from Bloomberg.com, which suggests that he has not yet given up completely:

U.S. Treasury Secretary Henry Paulson said Republicans and Democrats aren't as far apart on overhauling Social Security as their public posturing might suggest, and insisted all options are on the table.

In public, some Republican lawmakers declare they won't accept any accord that would raise taxes and conservative groups threaten to unseat any legislator that considers doing so. At the same time, Democrats say they oppose President George W. Bush's proposal to set up private accounts.

``When I'm talking alone, there's no one that really pushes back hard,'' Paulson said in an interview yesterday in Washington. ``If it's going to be bipartisan, you've got to come together and everything is on the table.''

Maybe they are not pushing back hard because they do not want to waste their time on a pointless argument about something that is not going to happen.

Josh Marshall On Social Security

Josh Marshall runs the highly influential Talking Points Memo blog. He was recently interviewed by Frontline. He had some interesting things to say. Here is an excerpt about Social Security:

And you say that in the Social Security area, the mainstream press really doesn't care about it because they make too much money?

I think the fairly comfortable economic position of a lot of the lead reporters makes them relatively indifferent to the future of social security. Yeah, I think that's true.

Their class position influences how they cover things.

Yeah. Not in ways that they're dishonest. I think all sorts of facts about individual reporters go into the assumptions that they bring to the news. Yeah, I think that that's one of them.

In the case of Social Security, another thing that played into that is the conventional wisdom in Washington, and the conventional wisdom in Washington on Social Security leaned right. ...

Astrue Confirmed

Michael Astrue has been confirmed for a six year term as Commissioner of Social Security. See the Congressional Record.

Don't Tell Anyone! Social Security Can't Answer Its Telephones

This is basically a repeat of some information from a January 4 post, but I think it is worthy of another look. Many of the people who read this blog are involved with the hearing process at Social Security. They are well aware of the backlogs and delays at Social Security's Office of Disability Adjudication and Review (ODAR), but Social Security's budget and staffing problems go well beyond ODAR. Some of the most indisputable evidence of Social Security's terrible budget problems is outside ODAR.

Read over the excerpts below from a report of a recent conference call between Social Security officials and the National Council of Social Security Management Associations (NCSSMA), an organization of Social Security management personnel, on the subject of answering the telephones at Social Security. Think about what kind of turnover Social Security must have at its teleservice centers and what a year long hiring freeze will mean for Social Security's ability to answer its telephones. What kind of service will the Social Security Administration be able to give by September 30, 2007, when this fiscal year ends? Also, think about this question, why did Jo Anne Barnhart, who was Commissioner of Social Security until a couple of weeks ago, not publicize the agency's problems answering its telephones, even when she was in the midst of a struggle to get adequate funding for Social Security? She had clear evidence that service at Social Security was already at a level that any Congressperson would have to agree is unacceptable, but even as she was threatened with a budget that would take the service situation at Social Security from an unacceptable level to a crisis level, she could not bring herself to tell Congress or the American people about the situation. The damning information has to come out of an organization that few people have ever heard of.

From FY 05 to FY 06 there were 1 1/2 million more calls coming in to the agents[at Social Security teleservice centers that answer Social Security's 800 number calls]. ...

Rick [Warsinskey, president of NCSSMA] reported how FO [Field Office] managers report that many calls go unanswered in the FOs. The most recent report states FO’s got 67.8 million business related calls in FY 2005. He asked if there was any possibility of getting more FO calls routed to the 800# either by Forward on Busy (FOB) or publishing the phone number in the phone book. Do the TSCs [teleservice centers, which answer the 800 calls] have the capacity for handling these additional calls?

OTS [Office of Telephone Services?] responded that the TSCs are beyond capacity. The targets are at 330 seconds to answer a call. The target busy rate is 10%. If we sent more calls to the TSC we could seriously degrade the service we are giving now. There is no capacity for that work in the TSC nor is there any capacity to handle it in the FO. The TSC targets are way higher than the private sector. One difference is that SSA will busy you out. Private sector will not busy you out.

Companies in the private sector have goals like: answer 80% of the calls within 20 seconds. They are competition and profit driven and that adds to their drive. SSA is no where near that. Even our 10% and 330 second targets are hard to meet. Since the beginning of FY 07, we haven’t met our target more than 20 days.

Fee Payments in 2006

The Social Security Administration has finally posted the final 2006 numbers on payments of fees to attorneys and others for representing Social Security claimants. Normally, Social Security posts these numbers within a few days after the end of a month, but the figures for November and December 2006 were not posted until today. Here are the final 2006 numbers:

Fee Payments
Month/Year	Volume	Amount
Jan-06	18,752	$64,848,326.02
Feb-06	20,426	$70,312.586.15
Mar-06	26,227	$91,045,934.83
Apr-06	23,042	$79,714,961.76
May-06	23,581	$82,015,869.29
June-06	27,771	$97,085,724.60
July-06	21,432	$74,648,883.83
August-06	24,579	$85,528,548.61
Sept-06	28,968	$99,124,616.47
Oct-06	20,246	$71,009,543.75
Nov-06	18,322	$63,636,873.26
Dec-06	20,717	$71,825,808.27

The final total for 2006 was $950,797,676.84. This is an 11% increase over the total for 2005, which was $862,369,764.09, although one should not infer from this that those representing Social Security claimants are enjoying rapidly increasing fees. These numbers are heavily influenced by the advent of withholding of fees in SSI cases and withholding of fees for certain non-attorney representatives. Without those fees being added, the increase would have been far less dramatic. Undoubtedly, there has been some increase in fees over the rate of inflation, but this has come at a cost to those representing Social Security claimants. As the length of time that Social Security takes to adjudicate cases goes up, the fees go up, since they are based upon the amount of back benefits, but so does the work that the attorney or representative must do. The longer the case stays open, the more telephone calls the attorney makes and receives concerning the case, the more medical development the attorney must do and so on.

Job Satisfaction Good At Social Security

The U.S. Office of Personnel Management took a federal human capital survey in 2006. Federal Agencies were ranked on their employees' job satisfaction. Here is the list:

Agency	2006 Ranking
Office of Management and Budget	1
Nuclear Regulatory Commission	2
National Aeronautics and Space Administration	3
National Science Foundation	4
Department of Justice	5
Department of State	6
National Credit Union Administration	7
Social Security Administration	8
US Agency for International Development	9
General Services Administration	10