Pelosi Rules Out Social Security Cuts

From TPM Media:

After a contentious White House meeting with President Obama and other Congressional leaders, House Minority Leader Nancy Pelosi (D-CA) returned to the Capitol and drew an important red line: Members of her caucus won't vote for a grand bargain to raise the debt limit and reduce future deficits if the final deal includes cuts to Medicare and Social Security benefits -- and that means it probably won't pass. ...

It's widely believed that House Speaker John Boehner (R-OH) will need Democratic votes to raise the debt limit. Democratic leaders, including House Minority Whip Steny Hoyer (D-MD) have offered to help him out -- but not on Boehner's terms alone. Pelosi has her own terms.

"We have been very clear Democrats are not supporting -- House Democrats are not supporting any cuts in benefits for Social Security or Medicare," she said....

 At the meeting, Pelosi spoke for her angry caucus. She and other Dems were caught off guard by the fact that Obama has essentially locked Congress on a course to make deep spending cuts in popular programs, on GOP-friendly terms, without consulting his own party.

One Angry Press Release

Another unusual event to report: Social Security sent out a press release on Independence Day! These normally are sent out to anyone who wants them delivered by e-mail but this one was not, apparently because no one was around the office to do it. This may especially be a problem now since the head of Social Security's Press Office just died suddenly. I was unaware of this press release until someone sent me a capy. Here is the press release, which obviously has an angry, defensive tone:

Syracuse's latest "analysis" is just more unsupportable grandstanding masquerading as academic research.  Federal law gives Administrative Law Judges substantial decisional independence in making their decisions, so variations between judges are a predictable consequence of Congressional decisions.

As with Syracuse's last report on Social Security, this one also is riddled with methodological sloppiness.  For instance, without other changes, a 30% increase in judges is going to increase the number of judges who are outliers at both ends of the spectrum, so simply comparing the range does not mean that decisions overall are more variable than in recent years. 

Syracuse also continues to compare apples and oranges.  For instance, National Hearing Centers (NHC) hear a rapidly changing mix of cases by video – one judge hearing cases from Anchorage while the judge next door is hearing cases from Puerto Rico.  Accordingly, it is irresponsible for Syracuse, as it does on page 5, to compare judges in an NHC with judges in a standard hearing office without accounting for the substantial differences in the age and origin of the cases.

We call on Syracuse University to insist that reports of this nature receive thorough peer review to end misleading errors, and to fully disclose the sources of funding for its reports.  Academic integrity requires no less.

Social Security Subcommittee Schedules Hearing On Short Notice

The House Social Security Subcommittee has scheduled a hearing on very short notice for tomorrow morning at 9:00. This is most unusual. The subject of the hearing is Social Security's finances. Here is the witness list:

• Syl Schieber, Ph.D., Independent Consultant, New Market
• Thomas S. Terry, President, T. Terry Consulting, on behalf of the American Academy of Actuaries
• C. Eugene Steuerle, Ph.D., Senior Fellow, Urban Institute
• Joan Entmacher, Vice President for Family Economic Security, National Women’s Law Center
• Charles P. Blahous, Ph.D., Research Fellow, Hoover Institution
• Barbara Bovbjerg, Ph.D., Director for Education, Workforce, and Income Security, U.S. Government Accountability Office

People Have Short Memories

Take a look at this report from the "Center for Studying Disability Policy" which recommends "work-support" programs as a way to reduce the burdens on Social Security's disability trust fund. (One word of warning, the Center's website caused my browser -- Firefox -- to freeze up. Could there be a metaphor here?) Three types of programs are recommended in the report:

• Earnings Support Insurance: New temporary program that would provide cash and employment supports funded by payroll taxes.
• Universal Short-Term Private Disability Insurance: Required short-term insurance provided by private insurers and funded through mandated employer and employee premiums.
• Experience Rating: A new formula used to determine the allocation of SSDI payroll taxes to employers, based on SSDI use by former employees.

I understand these ideas are receiving attention in Washington.

I put the name "Center for Studying Disability Policy" in quotations because it is not exactly what you might think. The "Center for Studying Disability Policy" appears to be a wholly owned subsidiary of Mathematica Policy Research which was at one time a major contractor with Social Security. What sort of contract did Mathematica have with Social Security? Oh, a contract to support disabled youth making the transition to employment, a contract which Social Security's Office of Inspector General  says cost Social Security over $44 million and which generated "little tangible benefit." I think that Mathematica wants to get back on that gravy train.

So, Mathematica is recommending another trip down the same path that proved unsuccessful in the past and people in Washington are listening. People have short memories. How many times has Social Security pored money down the rat hole of encouraging the disabled to return to work? Which of these efforts has demonstrated any viability whatsoever? These schemes are always promoted by Beltway Bandits whose only real interest is in getting contracts.

The problem remains what it has always been. If you require people to be half dead or fully crazy to get disability benefits, what makes you think that ANY program will show any significant success in returning them to work? If you want great success in returning people to work, make it vastly easier to get on Social Security disability benefits. Otherwise, you are just wasting money on research that is doomed to failure. 

Policymakers need to drop their illusions about who gets Social Security disability benefits in this country. They are NOT, in the main:

• People who have suffered some traumatic injury that will get better with time
• People whose only impairment is some injury or disease which has put them in a wheelchair but which leaves them able-bodied otherwise. 

They ARE, in the main, people who suffer from one or more of the following:

• Chronic, progressive disease, meaning they not only do not get better with time; they get worse
• Chronic, severe pain which is not going to get better over time
• Chronic, severe mental illness that is unlikely to get significantly better over time

If policymakers would understand who is actually on Social Security disability benefits, they would understand just how futile it would be to fall for Mathematica's scheme.

Angry Claimant Rams Car Into Social Security Office

From the Traverse City {MI} Record-Eagle:

Douglas David McCallum took a serious wrong turn, fueled, he said, by financial desperation and his frustration with the Social Security Administration's continued denial of his disability claim.
McCallum battled for six years to secure a claim his lawyers told him was a sure thing. But Social Security officials ruled otherwise, and McCallum's patience gave out Sunday evening, when he rammed his van into the closed Social Security Administration office on Munson Avenue in Traverse City.
"It was a fit of rage caused by years of being screwed over by the government," said McCallum, 47, of Kingsley.
Police arrested McCallum for malicious destruction of property, a felony punishable by up to five years in prison.

Readers Weigh In With Interesting Link And Comment

A couple of recent reader comments, both anonymous, are worth moving up to a more prominent place (I have reversed the order in which they  were posted.):

Here is the latest TRAC Report which discusses disparities among ALJs within offices.

http://trac.syr.edu/tracreports/ssa/254/

*surprised that Charles Hall failed to find and post this link.

Thanks to the reader for pointing this out. I had not seen it. 

No one knows better than a practicing Social Security attorney that there can be dramatic differences between Administrative Law Judges (ALJs). My response, however, is basically "Yeah, so what's your alternative? If ALJs didn't exist, you'd have to invent them to give the system any credibility at all. You can't get rid of ALJs and there's no practical way of controlling the disparities between them." But the next anonymous poster put it much better:

Having been a trial attorney for many years with many jury trials on the books, I am somewhat perplexed by the belief that judges should all fit in a certain statistical range. Juries operate with specific instructions just as judges act with specific rules and regulations but are human beings just like MOST jurors. We cannot expect human beings with past life experiences to act/react the same. Jurors do not see evidence the same way and neither will judges. A statistical bell curve will always exist as long as humans are making decisions. Maybe things would be better if we just fed all the information into a computer in the DOs [District Offices] and out would pop a decision like the take-a-number system used in the lobbies for interview times. The current system works better than anything else that could be devised to provide due process. The problem areas are very insignificant in the grand scheme and there are ways to address those areas without demeaning the entire process.

Social Security Benefits Cuts On The Way

TPM Media reports that a change to the chained CPI method of computing the Cost of Living Adjustment (COLA) for Social Security is being proposed by Democrats is the budget negotiations that are ongoing. This method would also be used in adjusting tax brackets which would also result in higher revenues but there would be twice as much in the way of benefit cuts as in tax increases. The Social Security COLA change would apply to current Social Security recipients.

If your eyes are glazing over at the thought of trying to understand the chained CPI method, look at the chart below (click on it to see it full size)and think about the fact that Social Security disability benefits recipients will be affected far more than retirees since they stay on benefits so much longer. There is an excellent chance this will become law in the next month.

Socia Security Employee Pleads Guilty To Fraud

From the Milwaukee Journal Sentinel:

A former U.S. Social Security Administration supervisor has pleaded guilty to taking Social Security benefits for someone who was ineligible because he was in prison.

Constance L. Dallas, 41, of Milwaukee had worked for the agency since 1988 and was most recently an operations supervisor at the SSA Teleservice Center in Milwaukee, according to the plea agreement.

On Friday, an SSA spokesman said Dallas resigned from the agency shortly before she pleaded guilty on May 31.

Dallas admitted to one count of defrauding the government by misusing SSA benefits.

Dallas admitted she took Supplemental Security Income funds meant for a man who, in fact, was incarcerated. The man was not named in the plea agreement, and there was no indication of the relationship between Dallas and the recipient.

According to the plea agreement:

Dallas was a designated payee for the man starting in October 2008, after he was released from prison on an unspecified felony. However, the man was not eligible to receive SSI benefits because he had received $15,000 from his recently deceased mother's life insurance.

Dallas knew about the insurance but became the man's designated payee anyway.

In January 2009, the man was locked up on a probation violation and remained behind bars until May 2010.

SSI does not allow prisoners to receive benefits. Dallas failed to notify the Social Security agency and continued to receive the checks.