United We Stand, Divided We Fall

Michael J. Boskin wrote an opinion piece in the Wall Street Journal published last Monday July 15, 2013. It was entitled the 2016 Disability Insurance Time Bomb. As we noted before, the Social Security Disability Fund will be bankrupt in 2016. As Boskin notes, this bankruptcy will hit just before the next Presidential and Congressional elections. Maybe that will force the Congress and the President to address this issue before that time. We hope so. Boskin further indicates ‘With luck, the looming implosion of the Disability Insurance Fund will focus attention on other entitlements…Coming to grips with the disability program also may provide a guide to reform of the larger programs.’ We whole heartedly agree and hope this impending bankruptcy would be the catalyst and provide a template for reforming the Social Security Retirement, Medicare, and Medicaid programs.
He reviewed the explosion of the beneficiaries and costs (from 2.7 million beneficiaries in 1970 to 11 million in 2012 and an 8 fold increase in expenditures if inflation is factored in during this same time period) and noted that the increase in both measures ‘is far beyond what would be expected from demographic trends and elevated unemployment’.
He reviewed the legislative history and noted the 1980 Congressionally mandated increased eligibility reviews followed by the backlash which resulted in the 1984 Congressional widening of the criteria to include back pain, arthritis and expanded mental illness diagnoses. Despite this enumeration, these factors still did not account for the explosion of beneficiaries and expenditures. He too then pointed to what Chana Joffe-Walt labeled the ‘vast disability-industrial complex’ .
To solve the problem with this program, Boskin suggests ‘starting with a more sensible definition of disability and more frequent re-evaluation’ as well as ‘better incentives to return to work for those who can.’ He also suggests implementing ‘another useful reform…base disability-insurance employer taxes on disability experience’. He noted this reform model has been successfully used in the Netherlands.
We hope the spot light shed on the Social Security Disability Program by Boskin’s article will spur the President and the Congress to take action on this soon to be bankrupt program.
Harry Pukay-Martin