Unemployment Offset Stalled -- For Now

     At the moment the bill to extend emergency unemployment benefits is stalled in the Senate. Even if the Senate could pass the bill, it faces an uncertain future in the House of Representatives. The Senate bill included a new offset that would reduce Disability Insurance Benefits under Title II of the Social Security Act by any unemployment benefits received. Even if the bill to extend emergency unemployment benefits cannot be revived, there's a good chance that the unemployment offset will come to Social Security eventually. It would save only a small amount of money, it would be difficult to implement and its fairness is debatable but the proposal has great superficial appeal and few opponents.

Appropriation Coming Soon -- Expect Service To Get Worse

     You may have heard that there was a "budget deal" in December and thought that it took care of the Social Security Administration. If so, like the vast majority of Americans, you don't understand the way Washington works. A "budget" just sets the top line numbers, that is the total amount to be appropriated and the share going to broad categories of spending. It's the appropriations bills that actually give agencies money to spend. The federal fiscal year began on October 1, 2013. Since the government shutdown ended, agencies have only been permitted to spend money under a "Continuing Resolution", knows as a "CR.". Under the CR, agencies can only spend at the rate they were spending in the prior fiscal year.
     It looks like we'll get something called the Consolidated Appropriations Act, 2014 passed by Congress and signed by the President by the weekend. Here's the House Appropriations Committee's summary of the Social Security Administration provisions of this bill:

Social Security Administration (SSA) – The bill includes $11. 7 billion to administer SSA activities, which is a $265 million increase above the fiscal year 2013 enacted level. This level is sufficient to allow the SSA to continue prompt processing of Social Security checks and claims , and will help ensure that all eligible recipients get their benefits on time and in the proper amount. Within the total, the bill devotes $1. 2 billion to program integrity activities to ensure that disability and other benefits are properly paid.

     Social Security had asked for $12.3 billion. The $1.2 billion for program integrity is the same amount that Social Security had asked for. Even the amount in the President's recommended budget, which was somewhat less than what Social Security had asked for, assumes continued deterioration of service at Social Security. Here's some data from the President's budget proposal:

Key Performance Targets:

• Initial Disability Claims Completed (thousands) FY 2012 3,207, FY 2013 2,970, FY 2014 2,851;

• Reconsiderations Completed (thousands) FY 2012 809, FY 2013 803, FY 2014 725;

• SSA Hearings Completed (thousands) FY 2012 820, FY 2013 836, FY 2014 807;

• Average Speed of Answer (ASA) [on Social Security's 800 number] (seconds) FY 2012 294, FY 2013 455, FY 2014 482

     Since the amount in the appropriation bill to be passed is significantly less than the President's proposal, we should expect a significantly greater degradation in service.

     I find it frustrating that so little attention is paid to Social Security's appropriation while enormous attention is paid to the chained CPI debate, if you can call it that. I wish the President had never talked about chained CPI but there isn't now nor was there ever the slightest chance that chained CPI would come to pass. However, a dramatic decline in public service at Social Security that is actually happening draws almost no national attention. Appropriations must seem so abstract if you don't personally deal with Social Security's operating components.

Challenges At Social Security

     From a report by Social Security's Office of Inspector General on the agency's Major Management and Performance Challenges:

While SSA made progress in FY 2013 in addressing these challenges, some improvements are needed.

• While SSA had a plan to eliminate the hearings backlog by 2013, the number of pending cases has increased, and the average processing time remains above the 270- day goal
• SSA needs to address millions of initial disability and reconsideration claims, as it still has backlogs of initial disability claims and continuing disability reviews.
• SSA is one of the Federal agencies with a high amount of improper payments. SSA will need to take additional actions related to reducing improper payments. ...

The Predictable Response

     Rupert Murdock owned media rush to claim that fraud allegations in New York City are proof of deep seated problems with the Social Security disability programs.

     In my mind, bank robberies aren't a sign that we need to shut down our banks. Fraud on Wall Street isn't a sign that we need to shut down our financial markets. Crime is crime. You take reasonable steps to prevent it. When it happens anyway, you punish it. You don't use it as an excuse to shut down vital institutions relied upon by the public.
     And, by the way, everyone needs to remember that no one has been convicted. Anyone writing about these charges needs to use the word "alleged." It's not simply a matter of fairness to those accused. It's a shame when someone who has been convicted gets off on appeal because hostile media coverage made a fair trial impossible.

CCD Opposes Unemployment Offset

     The Coalition for Citizens with Disabilities (CCD), the major umbrella organizations lobbying on disability issues, has come out in opposition to reducing Social Security disability  benefits on account of the receipt of unemployment benefits.

Don't Get Fooled

     From R.J. Eskow:

There is a highly funded campaign to cut Social Security and Medicare while distracting us from the true sources of our multi-generational retirement crisis. This narrative can be traced back to the work of conservative billionaire Peter "Pete" Peterson and his foundation, who sent minions like Alan Simpson out to stigmatize so-called "greedy geezers" for our country's retirement woes.

The Peterson crowd has worked very hard to convince Millennials that the older generation has robbed them of retirement security, a strategy they've pursued with false-front organizations like "The Can Kicks Back." A number of lazy journalists have bought into their narrative without consulting experts in the field ...

The Peterson cohort's goal was to convince Millennials that the best way to get even with their elders was by cutting Social Security -- for themselves. (Most benefit-cut proposals exempt those who are about to retire, for political reasons.) It's astonishing that they expected Millennials to fall for it -- which, according to polls they haven't. But then, it's equally astonishing how many pundits and politicians have fallen for it.

Getting Nuts

     This is getting nuts. Eric Holder, the U.S. Attorney General, has announced that the United States government will recognize, for purposes of federal benefits, presumably including Social Security benefits, same sex marriages performed in Utah during the brief period of time between the date that a U.S. District Court issued an order declaring Utah's prohibition of same sex marriages unconstitutional and the date that the Supreme Court granted a stay of that order. On the other hand, Social Security will not recognize the same sex marriages of Utah residents if those marriages were solemnized outside Utah! Does that make sense to anyone?

Offsetting Disability Benefits For Unemployment Benefits

     Michael Hiltzik at the Los Angeles Times doesn't like the idea of reducing Social Security disability benefits because of the receipt of unemployment insurance benefits. As he points out, this would only estimated to save $100 million a year. That estimate almost certainly doesn't include the cost of implementation. The cost of implementing new Social Security provisions is never taken into consideration. There's also the problem of state laws that run an offset in the opposite direction potentially subjecting a claimant to double offsetting.