The Third Way Looks A Lot Like The Second Way

From Bloomburg:

A Democratic-led policy group is defying party history by proposing changes to Social Security to pave the way for recommendations this week by President Barack Obama’s deficit-cutting commission.

Washington-based Third Way said its plan would raise the retirement age, trim or eliminate Social Security benefits for high-income retirees, limit cost-of-living increases and provide money to help young workers create private retirement accounts.

The proposal, to be released after the presidential panel is due to issue its report tomorrow, is timed to help create a buffer for congressional Democrats to support politically unpopular deficit-trimming measures, said Third Way spokesman Sean Gibbons. ...

The chairman of the group’s board of trustees is John L. Vogelstein, former president of private-equity firm Warburg Pincus LLC, and the vice-chairman is David Heller, global co- leader of Goldman Sachs Group Inc.’s securities division. ...

Social Security benefits would be reduced on a scale starting at individuals with $150,000 in outside income and couples with $250,000, and eliminated for individuals earning $200,000 and couples with $400,000 in income. ...

Even the AARP senior citizens’ group that’s long fought benefit cuts appears to be open to at least some cutbacks. John Rother, executive vice president for policy at the senior citizens’ group AARP, praised the Bipartisan Policy Center plan.

“It’s more politically realistic” than the Obama panel’s draft and “in general I would characterize this as a more centrist approach,” said Rother.

The basic premise of Social Security is that it is an insurance program. Republicans have never accepted that Social Security is an insurance program. They have always seen it as "welfare" program which must be phased out. Accepting any form of means testing in Title II of the Social Security Act would be to accept the Republican view of Social Security and would start a process that would destroy Social Security in the long run. This is a litmus test issue. If you believe that means testing of Social Security is appropriate, you believe that the fundamental premise of Social Security is a myth, which means that you just might be a Republican. Unless the Democratic Party has completely lost its mooring, this is going nowhere.

Where We Rank

The report of the Organization for Economic Cooperation and Development (OECD) report concerning disability programs around the world also includes a chart showing where the United States ranks in relationship to other countries around the world in the rate of disability benefits recipiency. See the chart below. Click on it to see it full size.

Note that we have a higher incidence of disability benefits recipients than many European countries. The fact that the full retirement age in the U.S. is higher than in most, if not all of Europe has to contribute to this. Otherwise, your explanation may depend upon your politics. I think that it has a lot to do with our poor health care system. A large part of our population is at enormous risk because they do not receive even basic medical care. Untreated diseases such as hypertension cause much disability in this country.

Hearing Office Chief ALJ Not Concerned By Threats

From the Akron Beacon Journal:

Judge Thomas A. Ciccolini is not a man easily shaken.

As chief administrative law judge in Akron's new Social Security disability claims office in the heart of downtown, he reacts with calm assurance to the news out of Washington that judges who hear these cases are facing an increasing number of threats from people who are denied benefits, or must wait a year (or more) for the case to be decided. ...

''I practiced law in Akron for 31 years. I did nothing but criminal work, so I know courtrooms can become volatile,'' Ciccolini said. ...

As the chief Social Security hearing officer in Cleveland, where he heard disability cases for seven years before assuming the lead position in Akron, he said he actually had a guard stationed in his hearing room on only a couple of occasions.

''I have conducted thousands of hearings in my seven years and cannot recall any violent incidents. Obviously, there is somewhere in the country that this has happened,'' Ciccolini said, ''but it just hasn't happened in this area.''

By the way, if you do not know what Social Security's hearing rooms look like, take a look at the picture above. Note that the room is not large or fancy and that it includes a large television screen with a small television camera attached to the bottom of the screen. The table in front of the judge has at least one computer monitor on it. The desk in front of the judge probably has another computer monitor on it just off camera.

A Little Help Please

For many years I have maintained that there is little or no proof that there is a significant link between rates of unemployment and the rates of disability claims. Common wisdom is to the contrary. The Organization for Economic Cooperation and Development (OECD) has released a report dealing with disability benefits around the world. Take a look at this chart (click on it to view it full size).

Could someone show me on this chart some evidence of a relationship between disability claims and unemployment?

Can Anyone Explain This?

From the Washington Post:

The government should create incentives for employers to retain disabled workers on their payrolls as a way of slowing unsustainable increases in the number of people receiving Social Security disability benefits, according to a new report.

Adding a "front end" of benefits to keep the disabled in their jobs could arrest the rapidly growing expense of the federal disability program, a problem that has largely escaped the scrutiny of policymakers, according to the report's authors at the Brookings Institution's Hamilton Project and the left-leaning Center for American Progress.

Their proposal would require workers and employers to share the cost of a modest private disability insurance package, which is between $150 and $250 a year, according to the report, which is to be officially unveiled at a Dec. 3 event in Washington.

Workers seeking to go onto the federal disability program would first have to be approved for benefits from the private policy. Those benefits would go toward rehabilitation services, partial income support and other related services, the researchers said....

David Autor, a Massachusetts Institute of Technology researcher who co-authored the study, acknowledged that the overall proposal would likely face huge hurdles in a political environment that is growing increasingly hostile to new government mandates.

$150 to $250 a year for private disability insurance? Turning over disability determination to private insurers who get to pocket anything they do not have to pay out? Rehab services to enable all those people with degenerative diseases to return to work?

What could possibly go wrong?

5th Anniversary

Social Security News is now five years old. I have made well over 4,000 posts. I have no idea how much time I have put in on it. I know that I have gotten a good deal of satisfaction out of it. I hope that my readers have found this blog useful.

Happy Thanksgiving

And to continue in a classic mode, read Art Buchwald's classic explanation of Le jour de Merci Donnant.

Something To Be Thankful For

I was able to use Social Security's online process for accessing the files that Social Security has on my clients files today -- using Firefox -- without difficulty. I have heard from some others who have had the same favorable experience this week. I hope that the problems of the past few weeks have been permanently resolved.