A disabling fiscal trend
Social Security Disability payments serve a necessary purpose, and the steep rise in Americans on disability raises serious concerns about the program’s sustainability.
The number of former workers receiving Social Security disability benefits rose from 5 million in 2000 to 8.8 million in 2012, according to a recent report in The Washington Post. And 2.1 million dependent children and spouses also receive benefits.
Thus, according to the Post: “The crush of new recipients is putting unsustainable financial pressure on the program. Federal officials project that the program will exhaust its trust fund by 2016 — 20 years before the trust fund that supports Social Security’s old-age benefits is projected to run dry.”
The “Great Recession” has significantly contributed to the upward trend in Americans on disability.
Many people who had been working despite physical problems lost their jobs. As the Post reported: “Finding new work often proved difficult, causing many to turn to the disability rolls for support.”
Cornell University Professor Richard Burkhauser, who has given expert testimony to Congress on this issue, told the Post: “The disability program is increasingly becoming a long-term unemployment program.”
Economist John Dorrer, former acting commissioner of the Maine Department of Labor, echoed that point: “The Social Security disability program has become an economic option for many people. As a result of the economic downturn, a whole lot of unskilled males 50 and over were bounced out of the labor force.”
And if the disability bill keeps rising at its currently rapid fate, Social Security’s long-term fiscal woes will intensify.
Medicare’s already shaky bottom line is also further endangered by the disability program’s growth: After two years on disability, Americans of any age become eligible for Medicare.
The disability program has already spent more than it collected in every year since 2009, the Congressional Budget Office reports.
And earlier this month, the Government Accountability Office concluded that the disability program made $1.3 billion in errant payments to people who had jobs when they were supposedly disabled.
Though that’s less than 1 percent of the $135 billion the program paid out last year, it’s reasonable to suspect that when disability rolls increase, so do the chances to scam the system.
And when people who don’t deserve Social Security disability payments receive them, the people who do deserve them today — and will deserve them in the future — are put at great risk.
So if our elected officials in Washington ever get around to the overdue task of reforming Social Security, that overhaul must include its disability system.
Otherwise, that program could be permanently disabled.