Laid-off workers and aging baby boomers are flooding Social Security’s disability program with benefit claims, pushing the financially strapped system toward the brink of insolvency.
Applications are up nearly 50 percent over a decade ago as people with disabilities lose their jobs and can’t find new ones in an economy that has shed nearly 7 million jobs.
The stampede for benefits is adding to a growing backlog of applicants — many wait two years or more before their cases are resolved — and worsening the financial problems of a program that’s been running in the red for years.
New congressional estimates say the trust fund that supports Social Security disability will run out of money by 2017, leaving the program unable to pay full benefits, unless Congress acts. About two decades later, Social Security’s much larger retirement fund is projected to run dry as well.
Much of the focus in Washington has been on fixing Social Security’s retirement system. Proposals range from raising the retirement age to means-testing benefits for wealthy retirees. But the disability system is in much worse shape and its problems defy easy solutions.
Mind you, the program is already insolvent as it has been paying out more than it’s bringing in in payroll taxes for years.
So this is the bankruptcy of the phoney-baloney Trust Fund for this particular program running out in 2017.
It’s unlikely that the situation will get better, due to both demographics and the long-lived Obama recession:
Claims for disability benefits typically increase in a bad economy because many disabled people get laid off and can’t find a new job. This year, about 3.3 million people are expected to apply for federal disability benefits. That’s 700,000 more than in 2008 and 1 million more than a decade ago.
“It’s primarily economic desperation,” Social Security Commissioner Michael Astrue said in an interview. “People on the margins who get bad news in terms of a layoff and have no other place to go and they take a shot at disability,”
The disability program is also being hit by an aging population — disability rates rise as people get older — as well as a system that encourages people to apply for more generous disability benefits rather than waiting until they qualify for retirement.
The DI program does not get as much attention as the Old Age portion of Social Security – mainly because it doesn’t cost as much.
Frankly, it’s not a large problem compared to Medicare or Obamacare. But it’s just one more aspect of a too-expensive wealth redistribution system that’s falling apart under the twin pressures of Boomers and a bad economy.
jefferson101 on August 22, 2011 at 2:03 pm said:
Given the way in which they seemingly allow people to qualify as “Disabled” for almost any reason, or none, I’m hardly surprised.
Be it noted that I don’t begruge helping those folks who are legitimately disabled, but it’s gotten to the point where qualifying for Social Security Disability is almost like qualifying for a “Handicapped” parking sticker. You bring a note from a Doctor.
Or maybe it would be like qualifying for Medical Marijuana in California……
Whatever. I’ve often considered getting my Doctor to write me a letter saying that I am suffering from a very difficult case of Motivational Deficit Disorder and turning it it just to see if I can get me some of that lovely free money. I know too many people who have done so on grounds almost that flimsy.
There are days when I’m pretty well convinced that the current system is damaged beyond all repair, and that the only way to fix it is to let it go smash and pick up the parts we need to have a proper system after the smash. It’s really depressing to know that there are a whole lot of people who are going to be underneath the thing when it smashes, though, and most of them will probably not make it out of the crater.
Naidyne on January 28, 2012 at 7:35 pm said:
I also do not begrudge the people who truly have a disability but I have recently become aware of gang members who are special education schools and refuse to do any school work getting SSDI.
jayare on November 11, 2012 at 12:46 pm said:
Hay jefferson101 the reason I get disability benefits is because I have lost 40% of my memory becays I have up to 5 grand mal seizures a day yes I have to take 7 different kinds of medications just to keep my self alive I only get enough mony to pay rent on a one room a.p.t and it is to dangourous for me to even walk out of hear because so much of my memory is gone I can't even rember my way back. I would Love to trade places with one of you people that think I have such a great life
Foxfier on August 22, 2011 at 8:37 pm said:
Coyote pointed out that he gets a lot of folks who try to get under the table jobs at his business.
Don’t kids who are diagnosed with ADHD get a stipend, too?
jefferson101 on August 22, 2011 at 10:17 pm said:
Not unless something has changed in the last 10 years or so. Although it may have.
They give almost anyone money, any more, so I can’t say they don’t do that. I may want to try that approach, too. I’d qualify in a New York minute, which is about as long as I could spend messing with it before I got bored and went back to work.
Heh.
juan on August 23, 2011 at 1:34 am said:
Another government entity with no cash in the till, projected to have
no cash in the till, in X number of years. Perhaps the moon landing
was really trick photography, after all? Journalism schools may teach
more semantics, than accounting schools, but the respective graduates
run neck&neck when it comes to applying them.
meep on August 23, 2011 at 5:58 am said:
The point is: they’ve actually been bankrupt for years now. (just as SocSec Old Age program is now in the red) — but this means they’ll be even =more= bankrupt.
Can’t get doomier than that, I suppose.
Joy McCann on August 23, 2011 at 6:21 am said:
The degree of denial out there is pretty amazing . . .
Trifolium on August 23, 2011 at 5:34 pm said:
Fitting with the stats, I’m amazed how I’ve gone from knowing nobody who was on full social security disability 10 years ago and today I personally know at least a dozen people. The baffling part of this trend for me is that 6 of that dozen are under the age of 40 and are claiming permanent disability due to mental illness (bipolar disorder mostly) and are getting it!! 2 of the 12 are under 30.
I would love to see the statistics re how many recipients are under 50.,,,under 40…under 30. Even assuming that many of these claims are vailid, I think it would tell a story of it’s own about motivation, ambition, personal accountability and work ethic in the U.S today.
juan on August 23, 2011 at 8:22 pm said:
The large number of families splintered by divorce, is another contributing factor.
People with undivided and supportive families are less likely to start a phony claim,
than people locked in the drama and aftermath of a broken marriage, custody battles, and property divisions. Some throw in the towel, and turn to the taxpayers for a government controlled bailout, when they would have been happier if they had persevered, and achieved even moderate success. That assumes a decent economy,
it’s worse when everyone has to downsize their spending.
Tsourus on September 15, 2011 at 8:33 pm said:
Dishonest attorneys, doctors and claimants are destroying this valued program. Turn on your Tv, and you will find ambulance chasers exhorting unemployed people to apply for disability. Under the treating liar (physician) rule, a note will do.