Tuesday, August 15, 2017

Hillbilly Retirement

Long before JD Vance wrote the groundbreaking Hillbilly Elegy last year, my cousin referred to Social Security Disability Insurance (SSDI) program as the "hillbilly retirement system."  She noted her family relatives in the Appalachian region looked forward to "getting on disability" since there were so few jobs worth having.  Sadly, she was right!

In 1997, there were less than 4.5 million Americans receiving disability.  In 2015, there were almost nine million Americans receiving disability.  This is costing us about $150 billion each year.  Plus, after two years on disability, the former workers become entitled to Medicaid, which is already costing us $80 billion each year.  The runaway growth of the SSDI entitlement began with a loosening of the appeals process, where a full 70% of SSDI denials are now being reversed by the administrative law judges, who have lifetime appointments.  Drive through the Allegheny region, and you will see countless billboards advertising legal help in navigating the disability process.

In 2015, more than a hundred police officers in New York City were charged with defrauding SSDI by alleging they have "anxiety issues," justifying disability payments equal to 75% of their base salary.

There is no good idea which cannot be abused!

Each person receiving disability payments is removed from the unemployed, which reduces the unemployment rate, which is already very low.  At the same time in the same country, there are more job openings than anytime in our history.

"Structural unemployment" is the name for the unemployed who are in the wrong place or have the wrong education and is the most difficult to reduce . . . unless you put them on disability.