America on Disability

NPR’s “This American Life” broadcast a report by Chana Joffe-Walt about the Disability system. It’s a real eye-opener. (click here; or, for a text version, here.)

The ranks of non-working people collecting government disability benefits have nearly doubled in 15 years, to 14 million. Yet they are ignored in employment/unemployment numbers. Every month we’re told how many jobs the economy added – but not how many people went on disability – usually more. (Thus while the “unemployment rate” (currently 7.6%) keeps going down, the percentage of people actually employed also declines.)

Three big factors ought to be reducing disability rolls. The 1990 Americans With Disabilities Act aimed to remove barriers to their employment. Medical advances make more health conditions fixable or manageable. And thirdly, automation and a decline in physically demanding jobs, in favor of the service sector and desk jobs, should enable more people with health issues to work.

Yet despite all this the disability system is ballooning. Why? What NPR’s report makes clear is that it has, de facto, become a hidden welfare program. Disability benefits go to many people not because they physically can’t work but because they’re not employable. They lack the education and/or skills to participate in today’s economy. That’s their “disability.”

This outcome is promoted by what Joffe-Walt calls the “Disability-Industrial complex.” But who, you might ask, could profit from this? Well – lawyers, for one. There’s a whole genre of firms that heavily advertise their specialty of winning disability benefits for clients. The system’s rules give such lawyers a direct cut of the government’s pay-outs.

NPR noted that in normal adversarial hearings (where I spent my career), a lawyer for one side is opposed by one representing the other. But in disability hearings, there is no one speaking up for the other side – for the government and its taxpayers who’ll have to pay if the claimant lawyer wins. No wonder those lawyers usually do win, making this practice so lucrative.

Another part of the Disability-Industrial complex is state governments. If someone’s on welfare, the state pays; on disability, the federal government pays. States have figured this out, and have mounted big efforts to move people from welfare to disability. One large private company makes its money helping states do this.

Disability recipient (colored finger disorder)

Now, you may also be surprised that a major part of the disability population is: kids.

It’s called “Supplemental Security Income,” and has grown sevenfold in three decades, to 1.3 million child recipients. They’re supposed to be disabled in getting through school. But they become cash cows for their parents. NPR profiled one kid who actually seemed to be thriving in school; and of course his mother wants him to; but not so much that the disability bureaucrats will notice and stop the payments.

I don’t want to imply people live high on the hog on disability benefits. The payments are small, they can’t earn any extra, so are really stuck in poverty. But meantime disability payments now consume a quarter of a trillion dollars annually, more than food stamps and conventional welfare combined. It’s a rotten picture all around.

In a democracy, government is supposed to do voters’ bidding, and they pay for it through taxes. But I don’t think voters and taxpayers were ever asked about this disability monster. It’s a key problem of modern government: programs mutating far beyond anything contemplated at their start, with no brake, no accountability. It just happens. (Well, in fact it doesn’t just happen – self-interested people like lawyers – and of course we’re all self-interested – make it happen for their own benefit.) And notice that in the recent “sequester,” things like air traffic controllers are being cut, but not programs like disability.

Paying for disability ultimately has to come from what actual working people earn and produce. And disability is just part of our larger economic challenge: an ever smaller population percentage actually working and producing, to pay for all those not doing so: the “disabled,” the welfare recipients, the unemployed, the kids in school till ever later ages, and of course the vast numbers living ever longer in retirement drawing pensions and racking up ever larger health care bills. All this on the backs of the shrinking core of people who produce.

As I’ve stressed till blue in the face, we can no longer tolerate an education system so crappy that millions don’t even finish high school and millions are relegated to lifetime “disability” benefits because they’re not employable. And how bizarre that with so many citizens not working, we’re so hostile to foreigners who want to come here to work. Without getting more people in productive employment, America will go bust.

Tags: employment, jobs, unemployment