WSJ Refutes WSJ Claims

     From Media Matters:

A Wall Street Journal article debunked the myth that federal disability benefits are to blame for the shrinking labor force, "exaggerated" claims that have previously been pushed by the paper itself.

An April 29 Journal article headlined "Real Culprit Behind Smaller Workforce: Age" explained that the recent decrease in the labor force -- the number of employed and unemployed Americans who are currently seeking work -- "has more to do with retiring baby boomers than frustrated job seekers abandoning their searches." The article noted that claims that Americans are voluntarily leaving the workforce to receive Disability Insurance instead of working, for example, "may be exaggerated," and explained that retirees and students made up a far more significant portion of those leaving the labor force. ...

However, the Journal has previously pushed the myth that Disability Insurance accounted for much of the dropping labor force participation rate. An April 10 article headlined "Workers Stuck in Disability Stunt Economic Recovery" claimed that workers receiving disability benefits were costing the economy billions by not instead participating in the labor force, and quoted economist Michael Feroli's claim that "worker flight to the Social Security Disability Insurance program accounts for as much as a quarter of the puzzling drop in participation rates, a labor exodus with far-reaching economic consequences." These claims are in direct contradiction to the Journal's most recent reporting.

ALJ Union Continues To Make Friends And Influence People

     From the opening statement of Representative Sam Johnson (R-TX), the chairman of the House Social Security Subcommittee at a hearing last week:

... I was outraged to learn that the union which represents Administrative Law Judges has just filed a lawsuit in federal court asking for an injunction against Social Security’s guidelines for judges to handle 500 to 700 cases a year.   

The union claims that these goals are “illegal quotas” and that management’s efforts to meet Congress’s and the public’s expectations for timely decisions interfere with judge’s decision-making independence. 

This is the same union that argues that these highly paid federal employees, who have no performance standards and cannot be fired without going through a time-consuming and expensive process, should be allowed to work at home at least one day a week.  

Let me be clear.  No one is telling any judge what decision to make, so their independence is protected.  And despite what the union argues, in FY 2012, 79 percent of judges were hearing at least 500 cases a year.  

Most taxpayers would be surprised to learn that last year the union representing judges spent $1 million in taxpayers’ dollars not on holding hearings, but on union activities.  That’s enough to fund a full year’s salary for nine judges.  

In fact, total taxpayer dollars spent by all four unions at Social Security reached $14.3 million last year, enough to fund a full year’s salary for about 206 employees. 

Hall Wins Award

     Stephanie J. Hall (no relation), Deputy Commissioner for Quality Performance at Social Security, is a 2012 Meritorious Executive Winner in the Presidential Rank Award Program.

Missouri Tries To Subpoena OIG Employee

     From the Springfield, MO News-Leader:

The Social Security investigator at the center of the controversy involving the concealed carry information of thousands of Missourians was subpoenaed Friday by the Missouri Senate.

The Senate issued the subpoena to Special Agent Keith Schilb with the Office of the Inspector General of the Social Security Administration, according to a news release from Sen. Kurt Schaefer, R-Columbia. Schaefer has led efforts to investigate the issue.

The Missouri State Highway Patrol has twice provided a list of concealed carry permit holders compiled by the Department of Revenue to Schilb, as part of an investigation of Social Security disability benefit fraud.

     Of course, Schilb won't appear. Federal employees are immune from state subpoenas concerning their official employment activities.

Getting On Disability For A "Self-Made Diagnosis"

     From syndicated columnist Froma Harrop:

We who work through colds, bad backs and low moods — however liberal we might be — have permission to resent those who could hold a job but don’t, preferring to collect disability checks...

More than 5 percent of eligible American adults are now receiving disability payments from Social Security. Twenty years ago, it was 3 percent. One reason is easier requirements giving more weight to self-made diagnoses of back pain or mental anguish.

Social Security’s disability insurance benefit has morphed into a $124 billion welfare program. ...

This discussion is ... about the reasonably able-bodied playing the scam and the doctors helping them. It’s about a government that doesn’t tighten the rules.

This Is Only A Drill

     From the Baltimore Sun:

An emergency drill at the Woodlawn-based Social Security Administration is likely to cause traffic delays Friday near Security Boulevard and Woodlawn Drive.

Most employees from the Security West building will be evacuated from the facilities during the drill. The public is encouraged to take a different route to avoid delays. The drill will take place in the afternoon, but Social Security declined to announce a specific time.

The exercise is required in accordance with federal, state and local requirements to prepare employees for any future threats they may encounter.

Study On Effects Of Great Recession On Disability Claims

     From the abstract of a study done by Norma Coe and Matthew Rutledge for the Center for Retirement Research at Boston College:

Much as in previous recessions, the number of applications to public disability insurance programs increased sharply during the Great Recession.  We find that the composition of applicants also changes across business cycles.  For example, applicants during economic downturns, and especially during the Great Recession, are younger, better educated, higher income, and more likely to have recent work experience.  However, we find only mixed evidence supporting the theory that the increase in applications in downturns is caused by healthier applicants who apply to disability programs only because they are unemployed. ...

We find that changing demographics and unemployment rates explain less than half of the increase in the application rate and only one quarter of the increase in the awards to applicants (the allowance rate) between the 2004-2006 expansion and the Great Recession.  Further, these same factors predict a fall in the award rate (among eligible individuals), in contrast to the increase observed in the data.  Together with the fact that there have been no programmatic changes in the disability programs in the 2000s, these results suggest there have been fundamental changes over the last decade in the way that people apply to disability and in the way these applications are evaluated that cannot be explained by observable differences.

     I have read through this report and do not see any explanation of the logic used by the authors in coming to the conclusion that there must have been some "fundamental change" in the last decade in the way that disability claims are evaluated. It is just stated baldly. The report indicates that the authors were, in general,  considering demographic factors such as age but it's quite clear that their focus was on macroeconomic factors. In general, I'm just leery of a report by economists who has no real understanding of how disability is determined at Social Security.
    In reports like this there is always the underlying assumption that working people with health problems sit around thinking about whether they should continue work or apply for Social Security disability benefits. I'm sure that some do but I'm also sure that's generally not the case. Only a few people stop work due to illness and then immediately file Social Security disability claims. The vast majority wait months, even years, to file disability claims. They hope they'll get better. They don't want to apply for Social Security disability benefits because they view it as difficult and unpleasant and an admission of a personal failing. Speedups and slowdowns in disability claims are primarily due to demographic factors but secondarily due to factors that increase or decrease the financial pressures faced by potential claimants who have already left employment. Often, potential claimants, that is people who have already left work due to illness, are motivated to file claims by the loss of some other family income, such as their spouse being laid off and their family being desperate for income. Almost always people stop work and only later start thinking about Social Security disability.

Cato Isn't Expecting Privatization

     Giving us an idea how the right wing views their chances of privatizing Social Security, Daniel Mitchell of the Cato Institute writes that that Australia's privatized Social Security system would be a great model for the U.S. All it will take for such a thing to happen in the U.S. is "some sort of Greek-style fiscal meltdown that led to a societal collapse." In a footnote, Mitchell says he doesn't think the U.S. is heading for such a collapse. I guess that means he thinks privatization of Social Security isn't going to happen.

    By the way, Australia never had anything like the U.S. Social Security system. What they had was a means tested program like the U.S. Supplemental Security Income program. That program never went away. They just added a mandatory retirement savings plan on top of it. Basically, Australia uses means tested programs a lot more than the U.S. If you try to compare Australia and the U.S.on income security, I think you're going to find far more indicia of government dependence in Australia.