March 24, 2013

Disability Is the New Welfare

NPR wrote a very interesting article titled Unfit For Work.    I'd encourage you to read the whole article.    The gist of it is simply :  The number of people on disability has risen steadily over the past 30 years.   This isn't a unique phenomenon related to the recent recession. 
 
The article says:

"The federal government spends more money each year on cash payments for disabled former workers than it spends on food stamps and welfare combined." 


Did you realize that?   I didn't.

Then theres this bit about how some people get on disability:

"Dr. Timberlake is making a judgment call that if you have a particular back problem and a college degree you're not disabled. Without the degree, you are."

This actually makes sense to me.   I myself have a back problem.   I work a 'cushy' office job where I sit at a desk the vast majority of the time.  Yet if I stand for too long my back and leg will start to ache.   If I didn't have a college education it would likely be pretty difficult for me to do a lot of blue collar jobs that require 8 hours of standing or repetitive work.    Reportedly 80% of adults have back pains at some point in their lives and its probably no coincidence that the #1 reason for disability is back pain.

The article shows various charts over time that show relationships between the number of people applying for disability to spikes in unemployment and the comparison of the people on welfare to the people on disability.  It seems fairly clear that disability is replacing welfare for many Americans.

A pretty obvious connection between welfare and federal disability is evidenced by this bit :

"PCG [Public Consulting Group] is a private company that states pay to comb their welfare rolls and move as many people as possible onto disability."

You read that right.   A private company is paid by the states to get people off of welfare and onto federal disability.   They say that Missouri pays the company $2300 per person.    The company facilitates individuals getting on disability and they have this quote from one of their agents talking to a welfare recipient:

"Can you think of anything else that's been bothering you and disabling you and preventing you from working?"

This makes twisted sense.   If an individual is on welfare then the state has to pay money, but if the individual instead gets on disability then the state saves money.   Individual states have financial incentive to get their welfare recipients on federal disability.  Its clear enough if they're paying a private company $2300 per head to get that accomplished.

I don't know what portion of people on disability are severely disabled and what portion  have less severe disabilities.   I also don't know hat portion of the people receiving disability are actually cheating the system.   But even if there isn't outright fraud the system is setup so that if you work in a blue collar job and get unemployed that you may end up on disability due to back pains whereas if you kept your job you'd likely continue to work.   Or if you get on welfare you may get 'helpfully guided' on to disability by the state and their private consultant. 

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7 comments:

  1. Thanks for the article link, Jim, that is amazing and full of facts. I have been searching for something this comprehensive for awhile on the subject. I am not seeing any way to reverse this trend (tripling of people on disability in the past 30 years to 10 million). The wrong people are breeding, no education or retraining will be sufficient, the wrong behavior is rewarded, and the government has no incentive to address this issue at the individual level while the private sector (Public Consuliting Group) does at $2,300 a head. Very discouraging. But I am glad to know this, so thanks again.

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  2. The way Social security is structured probably encourages this to a large degree. Based on my last SS statement, If I were to become disabled today, I would receive almost 40% more per month than if I retired at 62 and about the same as if I retired at 67. Even though I disagree with people going this route, I can't say I blame them for taking advantage of this (assuming they have a valid reason too).

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  4. My uncle had a blue collar job and got laid off in his mid 40s without a lot of other prospects. He went on disability for a bad knee, although technically, he could definitely still work (he makes furniture, plays basketball, and takes care of grandkids, etc.) Disability is definitely the new welfare and it doesn't seem to be too hard to get!

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  5. I heard the story on NPR and I think it's BS. There should be different level of disability. If you have a backache and shoulder pain like me, then you shouldn't get much disability if at all.

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  6. What timing. I just heard an episode of This American Life on this very topic. What they conclude in the radio show is that there are many factors causing the increase of disability receivers.

    In one town, a doctor is very sympathetic to the citizens with physical pain that impacts them in the work they currently do. But this low income community has few options for jobs not requiring physical exertion or standing. Their options are so limited, some of them have never even considered looking for a job they can perform with their physical condition.

    A second reason, in summary, the government set up the system to make it easier for low income people to get help applying for disability. So they pay lawyers, legal teams, to help get people on disability. And because the State pays for welfare, while the Federal government pays for disability, the states pay decent money for anyone getting a person onto disability. So there are many incentives set up to promote getting people on disability.

    http://www.thisamericanlife.org/radio-archives/episode/490/trends-with-benefits

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