Fear Mongering?

     Would the Wall Street Journal engage in fear mongering on Social Security? Here's what they wrote today:

Q: Will I receive Social Security benefits?
A: That's a big "It depends." If you're over 65, no sweat. If you're 45-65, you might see some changes from the relatively generous benefits enjoyed by your parents. If you're under 45, you have plenty to worry about.

     Actually, I don't think this is fear mongering but only because I think they believe it. The problem is that they just don't get it. Social Security isn't protected by the trust fund. In and of themselves, the Social Security trust funds are more trustworthy than any of the country's financial institutions but they're still promises written on paper. Social Security has something far stronger going for it than the trust funds. Widespread, unshakeable public support. The writers at the WSJ are in the small minority that doesn't support Social Security. They think that eventually the rest of the country will see things their way. That hasn't happened in more than 75 years. I see no reason to think that will ever happen. 

     As I've written before, the concept of Social Security started with Bismarck in Germany well over a century ago. Social Security has persisted in Germany despite its devastating loss in World War I, hyperinflation during the Weimar Republic, Germany's devastating loss in World War II, the division of the country after the Second World War, the Cold War and the eventual reunification of the country after the fall of the Berlin Wall. If all that couldn't destroy Social Security in Germany what sort of catastrophe would take to destroy Social Security in this country? Nuclear holocaust?

Disability Decisions 2012

Representative Payee Embezzles From 23 In New Hampshire

     From the Concord, NH Monitor:

A Weare woman has been sentenced to 13 months in federal prison for embezzling more than $52,000 in Social Security and veterans benefits.

Heidi Lacerte stole the funds from 23 people while she was employed at the Office of Public Guardian, a nonprofit that serves hundreds of legally incapacitated people across the state, according to a release from the U.S. attorney’s office. According to court documents, the 48-year-old woman embezzled funds that had been paid to her office and placed in an account where they could be used for clients’ medical and financial needs.

ODAR Backlog Report

     This is a report from Social Security's Office of Disability Adjudication and Review (ODAR) showing the state of the backlog of cases waiting to be heard at each of its offices. Click twice on each image to see full size. This report was printed in the newsletter of the National Organization of Social Security Claimants Representatives (NOSSCR). The newsletter is not available online.
     Note the persistence of extreme variations between offices. Also, note the national trend line on the backlogs:

• February 29, 2008 -- 511 days
• March 8, 2009 -- 499 days
• July 5, 2010 -- 415 days
• February 1, 2011 -- 371 days
• July 27, 2012 -- 357 days
• February 22, 2013 -- 382 days

     The backlog has gone up by almost a month just in the last seven months. That's a scary trendline -- and that was before sequestration began.

CR Doesn't Cut Any Breaks For Social Security

     The Senate has passed a Continuing Resolution (CR) that will fund government operations through the rest of the fiscal year, subject to the sequestration. It is likely to be adopted by the House of Representatives intact. Here are the provisions relevant to Social Security, which I won't even try to interpret other than to say it seems clear to me that the agency didn't catch any breaks:

SEC. 1517. Notwithstanding section 1101, the level for ‘‘Social Security Administration, Supplemental Security Income Program’’ for research and demonstrations under sections 1110, 1115, and 1144 of the Social Security Act shall be $17,000,000.

SEC. 1518. Of the funds made available by section 1101 for ‘‘Social Security Administration, Limitation on Administrative Expenses’’, $23,000,000 shall be for section 1149 of the Social Security Act and $7,000,000 shall be for section 1150 of the Social Security Act.

SEC. 1519. Of the funds made available by section 1101 for ‘‘Social Security Administration, Limitation on Administrative Expenses’’ for the cost associated with continuing disability reviews under titles II and XVI of the Social Security Act and for the cost associated with conducting redeterminations of eligibility under title XVI of the Social Security Act, $273,000,000 is provided to meet the terms of section 251(b)(2)(B)(ii)(III) of the Balanced Budget and Emergency Deficit Control Act of 1985, as amended, and $483,052,000 is additional new budget authority specified for purposes of section 251(b)(2)(B) of such Act. ...

SEC. 3004. (a) If, for fiscal year 2013, the amount of new budget authority provided in appropriation Acts exceeds the discretionary spending limits set forth in section 251(c)(2) of the Balanced Budget and Emergency Deficit Control Act on new budget authority for any category due to estimating differences with the Congressional Budget Office, the Director of the Office of Management and Budget shall increase the applicable percentage in subsection (c) with respect to that category by such amount as is necessary to eliminate the amount of the excess in that category. ...

     (c) For purposes of subsection (b), the applicable percentage shall be—

          (1) for budget authority in the nonsecurity category (as defined in section 250(c)(4)(A) of the Balanced Budget and Emergency Deficit Control Act of 1985), 0 percent; ...
(e) This section shall not apply to— ...

       (2) the amount made available by division C of this Act for ‘‘Social Security Administration, Limitation on Administrative Expenses’’ for continuing disability reviews under titles II and XVI of the Social Security Act and for the cost associated with conducting redeterminations of eligibility under title XVI of the Social Security Act.

What About Alan Simpson As Chairman?

From the Associated Press:

The Senate's No. 2 Democrat said Wednesday that he's preparing a plan to create a commission to study Social Security's fiscal problems and send a proposed solution to Congress for guaranteed votes in both House and Senate. 

Illinois Democrat Dick Durbin says he's got bipartisan backing for the idea, which is patterned after President Barack Obama's 2010 deficit commission. ...

"You would basically say to a commission, within a very limited time frame, to come up with a proposal for 75-year solvency of Social Security and then — and this is important — it would be referred to both chambers on an expedited procedure," Durbin told reporters ...

Durbin's proposed 18-member commission would contain an equal number of Republicans and Democrats but require 14 votes to send a plan to Congress. 

A "Ringing Call For Incrementalism"

     Some excerpts from an address by former Social Security Commissioner Michael Astrue at a Social Security Advisory Board (SSAB) forum on March 8: 

I want to thank the SSAB for inviting me back to Washington.It has involved some sacrifice for me -- I’m going to miss the Early Bird Special this afternoon ... but I should be back in Boston for bingo tonight. ... 

Unlike in the past, we should not expect that this Congress will do a quiet and efficient reallocation of the Trust Funds to cover the OASDI [Old Age Survivors and Disability Insurance] deficit. We do not have a sufficient number of the Daniel Patrick Moynihans & Bob Doles, the Bill Archers & Barbara Kennellys, enough leaders to lead a civil, informed debate on a hard topic . What we must try to do now to is start a process of education and dialogue that could let us avoid another inflamed, last-minute public spectacle, like the fiscal cliffs and sequestration, driven by what Stephen Colbert calls truthiness rather than actual truth....

[I]n order to pay for sexier items, Congress had drained the SSA [Social Security Administration] administrative budget so badly over two decades that the inevitable occurred — backlogs increased not only for hearings, but also for the continuing disability reviews that are the agency’s main weapon against improper payments. Having said that, the level of actual fraud is still extremely low, probably some fraction of one percent of the people receiving benefits. C ritics of the agency have resorted to distoring data that relates to the perfection of documentation — not fraud, not even improper payments — in order to support overheated claims of massive fraud....

The number of people on the rolls is rising substantially, but that rise is a predictable consequence of the baby boomers reaching their disability -prone years, not the product of new rules or management. ...

By contracting with the Bureau of Labor Statistics to supplement the existing O*Net system, the agency has shaved tens of millions of dollars off the cost of replacing the DoT. It may be doable for an additional cost of 10-20 million dollars and periodic costs for updating ... 

I am very concerned , though, about the possibility of another well-packaged but ill- considered reform initiative driven by the OMB [Office of Management and Budget] institutional views, which relies on the fallacy that we can solve problems created by bureaucracy and complexity with ever-more complex bureaucracy and complexity. Like Ahab chasing Moby Dick, they reject all the evidence and experience to date and insist that they can harpoon a system that will be so much more accurate up-front that Congress will be impressed by the back-end savings and fund the added bureaucracy. 

This whale hunt failed with the Clinton Administration’s prototype initiative, and it failed more miserably with the Bush Administration’s DSI initiative. In fact, DSI almost brought the agency to its knees...

OMB should drop its harpoon, let that imaginary whale swim into the mist, and focus its attention on actions that could actually produce real program savings : two-year rather than one - year appropriations cycles; stronger support by the Appropriation Committees for the IT [Information Technology] carry-over fund; and CDR [Continuing Disability Review] funding formulas that would allow CBO [Congressional Budget Office] to score the program savings in a way that would shelter associated administrative costs. ...

I submit to you that the academics, the policy experts, and the advocates of all stripes have not demonstrated an overarching issue in the system that could be the foundation for sweeping reform. Most of the time Social Security disability does exactly what the American people want it to do, which is to provide a safety net for people whose medical problems dictate  that they legitimately cannot work for a year or more. I can tell you better than almost anyone that the system is far from perfect, but the problems result from many very different failings throughout a highly complex system, not one or two overarching issues. In my opinion, there is no magic bullet solution, only scores of detailed answers to very specific problems. ...

My ringing call for incrementalism is hardly sexy, but if you care about supplying a compassionate but cost-effective safety net for the disabled, you will need to have a laundry list of concrete reforms to offer Congress in the next year or so....

Let me “help” you with this list. ...

[B]udgeteers in state agencies have figured out that they can shift their program costs to the administrative budget of SSA by requiring a decision on disability from SSA before allowing people to collect benefits from TANF [Temporary Assistance to Needy Families] or some other state-funded program. .... It is time that Congress closed this loophole and made it explicitly illegal to condition receipt of any benefit upon an SSA disability determination if that benefit is partially subsidized by the federal government....

Another similar area for action is concurrent application for both unemployment and disability....

Congress can also help claimants help themselves by authorizing SSA to direct the state agencies to develop comprehensive, up-to-date websites in each state that include: 1) sources of assistance for free pharmaceuticals; 2) locations of DOL [Department of Labor] one -stop offices; 3) information about services available from the state vocational rehabilitation agency; 4) disease groups that offer supportive services; and 5) a primer about looking for work on the Internet and information about data bases that list available jobs, both locally and nationally.  ...

Congress also needs to give the Commissioner the mandate to begin over the next five years an orderly elimination of the reconsideration step that occurs in most, but not all, states ...

[A]bout half of the [hearing] backlog reduction came from more resources and about half came from increased productivity....

SSA accomplished much of this progress over the intransigent resistance of the Office of Personnel Management [OPM[ They steadfastly refused to reopen the [Administrative Law Judge hiring] list for over ten years — imagine what your hiring would look like if you could only hire off a list that was ten years old! I sat in one meeting where a senior OPM official told John Berry and me that there was no reason to consider new applicants until SSA hired from the last person left on the list. What does that statement say about OPM’s commitment to quality in public service? What makes it worse is that OPM is spending a lot of trust fund money doing very little.  ...

I believe the ALJ position is the only job left in the civil service that requires a test, and it is a test designed by people who have no understanding of the administrative process and no desire to learn. It has become a budget game to pad the OPM budget at the expense of the trust finds. For instance, not long before I left I learned third-hand that trust fund money is going to develop a new on-line testannounced this week will be administered by little cartoon figures on the screen. Little cartoon figures... 

Where are the oversight committees on this critical function? OPM’s work is excruciatingly slow, outrageously expensive, and of unacceptably poor quality —and it has been so since at least the Clinton Administration. OPM damages SSA’s efforts to supply timely, high-quality justice, and it is time for Congress to move OPM’s responsibilities in this area to a federal agency that understands administrative law — either the Department of Justice or the Administrative Conference of the United States. ... 

Congress needs to streamline its statutes on return to work. Congress has tended to have an unrealistic view as to how many recipients can return to work. Somewhere around 60% of the people on the rolls have no realistic expectation of returning to work — they have fatal diseases, like ALS or Huntington’s, that are certain to continue debilitating the person until he or she dies a premature death. Some people have horrific brain damage from car accidents or military service. For many of the 40% for whom a return to work would be difficult but perhaps possible at some point, the layers of new incredibly complex statutes to encourage work have become counter-productive....

When Congress gets serious about addressing the 2016 insolvency of the trust funds, there will be bad ideas floating around too. The one that has the most currency baffles me, which is another try at making hearings adversarial. I was stunned when I first answered questions before Congress on this proposal because none of its proponents knew that the agency had piloted this proposal in the 1980’s and that it failed miserably. It was expensive — probably several hundred million dollars to implement fully in today’s dollars — and it made no difference in outcomes while simultaneously undermining public confidence in the agency.  ...

Social Security Subcommittee Hearing

     The written statements for today's hearing before the House Social Security Subcommittee are now available.

• Patrick P. O’Carroll, Jr., Inspector General, Social Security Administration Testimony 
• Arthur R. Spencer, Associate Commissioner, Office of Disability Programs, Social Security Administration Testimony 
• Kathy Ruffing, Senior Fellow, Center on Budget and Policy Priorities Testimony 
• Trudy Lyon-Hart, Director, Office of Disability Determination Services, Vermont Agency of Human Services, on behalf of the National Council of Disability Determination Directors Testimony 
• David Hatfield, Administrative Law Judge (Retired), Wexford, Pennsylvania Testimon

     I see little, if anything, new in these statements.