As
discussed in last month’s postings, the Old Age and Survivors Benefits
component of Social Security could be made viable by voluntary individual actions. It only requires adjusting the program to
reflect twenty-first century reality. The adjustments have no financial cost
and minimal political cost, but they require encouraging longer work lives
necessitated by increased life expectancies. A major obstacle to responding to
reality seems to be that it would mean those politicians who want to run on
class warfare-based lies would have to leave Social Security out of their
rhetoric. Some politicians find changing
their rhetoric difficult, but others would quickly recognize that there are
other ways to take advantage of the politics of envy.
Fixing the
Disability Insurance component is more complicated. Disability is an interesting phenomenon. At the aggregate level it’s easy to analyze
and identify, and as will be discussed tomorrow, it has almost nothing to do
with disability. It’s a different story
at the individual level. It’s extremely
hard to analyze and identify, and usually has everything to do with perceived disabilities.
As a
consequence, Disability Insurance is too convenient as a way for politicians to
hide policy failures. It is just so darn
easy to get away with contradictory positions.
It’s apparent nothing related to disability is ever questioned. For example, we pay lip service to providing
the disabled with equal opportunities.
Simultaneously we provide Social Security Disability Insurance on the assumption
the “disabled” can’t work. Yet, we see
no contradiction. Further, we embrace
advances in medicine that improve the ability to diagnose disabling conditions
while ignoring medical advances that improve the treatment (e.g., we will have
an Olympic sprinter running on prosthetic lower legs). The reason is that the more government uses
SS Disability Insurance to offset economic policy failures (lack of growth and
the resulting high unemployment), the more popular it becomes.
Meanwhile,
the public is wise to the game and plays along.
Yet, the public shouldn’t be blamed.
We acknowledge that individuals aren’t always capable of assessing their
own capabilities. However, we fail to
realize the same situation all too often applies to disabilities. We completely ignore the role of motivation
as an influence on ability and disability.
We pretend experience doesn’t influence an individual’s perception of
disability. Further, we totally overlook
the role of an individual’s economic circumstances in defining disability. Finally, we concede the judgment of what
constitutes a disability to the faceless bureaucracy of government while ignoring
the additional complications introduced by the bureaucrat’s prejudices.
The
solution is so obvious, but it requires major changes in programs. Most importantly, treat disability as a
policy issue and totally separate it from Social Security. Perhaps eliminate it as a component of the SS
program. There is no logical reason to
complicate a program driven by demographics by folding in a program driven by business
cycles. As administered by government, SS Disability Program is more like
Unemployment Insurance than Old Age and Survivors benefits.
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