Monday, April 08, 2013
Buying Off Discontent: The Economic Wreckage of Disability Benefits in America
You lose the factory job you’ve had since high school due to cut-backs. When the unemployment runs out, the only jobs around for high school graduates are fast food joints and entry-level work – a huge pay cut. You discover you can make nearly as much money on disability. Your doctor diagnoses you with chronic back pain (all those years of standing on the factory floor), and you have joined the ranks of “not-unemployed-but-disabled.” The state in which you live is happy because you don’t need any more of their unemployment money, and the federal government is happy that you are not an unemployment statistic, gumming up jobless rates.
Or there’s this. You scrape by on your job, managing bare essentials, but it’s tough. There’s no health insurance. You find out from your kid’s school counselor that because he has ADHD and isn’t learning at grade level, he may be eligible for disability. Suddenly, you’ve got $700 more every month, so long as your kid stays below grade level. You have a perverse hope that your kid doesn’t catch up in school.
It’s a boardwalk shell game with the federal government as huckster: Is the money under the shell marked “unemployment,” “disability” or “Social Security”? Is the disabled person the kid who can’t read, the factory worker whose unemployment ran out, or the truly disabled? The shells get moved, sleight of hand is performed, and the player’s money is quickly scooped up.
Disability has become America’s hidden welfare and unemployment program. People on disability don’t count in the ranks of the unemployed, and those unwilling to work but not eligible for welfare can often find a medical issue to keep checks rolling in. Perhaps most devastating, we’ve unwittingly created a system where people who could genuinely be helped by neighbors, churches, and charitable organizations are simply sent a check and told to go away.
By now, NPR’s Unfit for Work: the startling rise of disability in America has made the media rounds. Chana Joffe-Walt spent months researching the enormous rise in disability payments in the United States. Is the health of Americans spiraling downward at an alarming rate? Are disability claims being rubber-stamped by careless government wonks? Why are 14 million Americans (more than the total number of employees in the manufacturing sector of the economy) categorized by the government to be so ill that they’re unable to work?
In Samuel Gregg’s Becoming Europe, he examines the entitlement state that is modern Europe. In today’s European Union, people expect life-long job security, health care and education, along with cushy pensions. Politicians, not wanting to deal with civil unrest and eager to please voters, have been happy to “buy off discontent” (Gregg) despite the cost.
That’s the problem: “Wilhelm Röpke pointed out that welfare states are like progressive taxation: once one accepts the basic principle, there is nothing in the welfare state’s conception to set a limit to it,” Gregg writes.
In other words, where does it stop? When does the government say, “We can’t and won’t pay for that?” In the EU’s case, the answer seems to be “never”.
Increasingly, this seems to be the American answer as well. Is it hard to get disability? Yes and no. The process is tedious, but the categories that constitute disability are broad and ambiguous. An infographic for those researching disability says this: “If you believe you’re eligible for Social Security Disability Insurance benefits, don’t be discouraged by funding issues. These should ease when the economy improves and the government tightens spending on lower priorities.”
Americans should not only be discouraged, but deeply alarmed by funding issues. Since 1960, entitlement programs (like Social Security, unemployment and disability) have grown twice as fast as personal income. Today, government entitlement accounts for two-thirds of government spending. One in five Americans now receives some form of government benefit. The cost for disability, including health care for the disabled, is at least $260 billion a year.
Beyond the obvious fiscal nightmare, there is a cultural timbre that resonates throughout the numbers, statistics, and programs: We are a nation of takers. Increasingly, we want what our European counterparts have: a guaranteed paycheck, free education and health insurance, all government-provided.
There has always been a generous spirit in America towards the downtrodden, but it’s time to realize that we are no longer being generous: the government is leading us merrily along the path of fiscal fugue. If you’ve got a job, you’re paying for someone else’s big screen TV, disability check and health insurance. This is not to say that there are not those who are genuinely disabled. However, America has millions of people who could work but don’t. There aren’t jobs for them, they don’t have the skills for the jobs available, or they just plain don’t want to work. We’ve got children whose inability to read well is helping pay the family rent.
This is our miserable “system”: we have a cultural climate that wants something for nothing. We’ve got people who’d like to work, but have to function in a stagnant economy that removes incentives to creativity and entrepreneurship. For jobs that are available, there are millions of under-skilled people. We are paying to keep children from learning. We’re in the midst of shredding a safety net for the truly needy, attempting to solve issues such as learning disabilities, under- and unemployment with a program that can’t and won’t ever resolve those problems, and are stalled in finding real solutions because the federal disability program as it stands now is essentially hiding these dilemmas.
America is attempting to buy off people in their discontent. The discontent remains, the money will dry up, and we’re left with 14 million people who’ve been taught their gifts and talents have no value in this American society. Our disability system needs to be dismantled.
Vermont First State To Reveal Big Incentive For People To NOT Buy Health Insurance
Vermont is the first state to reveal what insurers will likely be charging for policies on its exchange. That also makes Vermont the first state to reveal that many individuals and families will have a big financial incentive to forego insurance and pay the ObamaCare penalty.
Here are some of the examples the Vermont exchange provides of the premiums people will pay after the tax credits kick in. Keep in mind that the ObamaCare penalty for not buying coverage is $695 or 2.5% of one’s income*, whichever is higher.:
1. One article about Vermont notes that a “single self-employed person earning $40,000 a year could go from a $600 a month premium, down to $317 a month.” That’s about $3,804 a year. Since the ObamaCare penalty for this person is $1,000 ($40,000 * 2.5%), the single self-employed person will have about $2,804 worth of incentive to decline insurance. But what if he gets sick? Well, ObamaCare has “guaranteed issue” which means that an insurance company must sell him a policy at anytime. So why pay $3,804 a year when he could pay $1,000 knowing that he’ll still be able to buy coverage if he falls ill?
2. According to a Vermont Exchange press release, “a family of four with a household income of $75,000 per year will pay a little under $600 per month for family coverage with a federal premium tax credit. This is compared to over $900 for the lowest cost small group plans available today.” The Exchange forgot to mention that also is compared to the $1,875 penalty which is about $5,325 less than the $7,200 that family will be paying for coverage annually. In this case, ObamaCare not only incentivizes the family to forego insurance, it incentivizes the parents to teach the children that it’s best to wait until you get sick to get coverage. Who says family values are dead?
For more on the fiasco that is the individual mandate, see this excellent post by Avik Roy from July of last year.
*$695 or 2.5% of income is the ObamaCare penalty in 2016. In 2014 it is $95 or 1.5% and in 2015 it is $325 or 2%. Of course, that means that in 2014-15 people have even more incentive not to buy coverage.
Small Cities in Small Counties
I love county-level political events.
Unlike major Washington, DC-based events or national political conventions, the people who come to Lincoln Day (on the GOP side) or Jefferson-Jackson Day (for the Dems) dinners, or county picnics during the summer, or participate in parades are the people who are truly the backbone of American politics.
The tickets to the event here at the local Shrine hall were, I think $35 per head. Silent auction, extra. The meal itself would have cost $85 each at a restaurant in downtown Washington.
I am certainly not opposed to events that bring in the high rollers. You don't have to have a PhD in political science to understand that an event that will attract 50 guests at $1,000 per will raise a lot more money than an even that has 250 people at $35 each. ($50,000 vs. $8,750.)
County events are a collection of people who know each other. In a county like Washington (one of Ohio's 99), these same people belong to the Rotary, or Lion's clubs or the Masonic lodge.
They are retailers, run small engineering, public relations, or manufacturing firms. Or they are the lawyers and CPAs who support them. Their spouses are school teachers or scout leaders or manage the Sunday school at their church.
These are people who could have moved to, and been successful in, Columbus, or L.A. or New York, but they chose to stay here.
They have known each other since grade school. They played on the same teams in Little League or Legion Ball. They had the same teachers in high school - or they are the high school teachers and the Little League coaches.
They remember the same stories and retell them with relish every time they get together - the rolling eyes of their spouses notwithstanding. They tell the stories at their Saturday golf game, or their regular Thursday girls-night-out dinner.
At election time they walk their precincts and drop of materials at the homes of people they know are Republicans and skip the homes of the people who are Democrats (or the other way around). They know which is which without computer print-outs or micro-targeting reports because they knew their parents were Republicans (or Democrats).
When they attend a Lincoln or Jefferson-Jackson Day Dinner they don't come back later asking for an Ambassadorship to France or an appointment to a national Commission. They might need a curb cut for the new garage to house the truck they just bought for their business, but $35 isn't likely to buy that decision.
It doesn't matter if MSNBC is pushing the most Liberal Democrat, or Fox is pushing the most Conservative Tea Party candidate. It doesn't matter what the national print reporters are tweeting about, or what the cable punditry is focused on.
These people are trying to elect members of the City Council. Or County Commissioners. Or local judges. Or a State Representative.
I got to talk about being Dan Quayle's and Newt Gingrich's press secretary and being a senior advisor on the Fred Thompson campaign. I think they liked hearing about my being on TV with Donna Brazile and Bob Beckel, but only in the way they might thumb through a magazine in the checkout line at the supermarket.
This Lincoln Day dinner was special for me because I've known many of these people for decades - the MC, in fact, said that next year will mark our 40th year of knowing one another.
They listened to me on the radio as the local news director. They saw me covering events - both news events and community events. One person reminded the audience that a long-ago Mayor declared I was a major pain in his "posterior."
I was a City Councilman here. Many of the people at the dinner voted for me, lo those many years ago. Nancy Hollister, the woman who took my Council seat when we moved to DC went on to become the Lt. Governor of Ohio.
She was there, too.
The Mullings Director of Standards & Practices and our son were born here.
If you wonder why I make such a big deal about Marietta, Ohio 45750 it’s because, as I said in my remarks "I wasn't born here, I wasn't raised here, but I came of age here."
Small cities, in small counties are the backbone of American politics and, in a very real way, are the heart and soul of the American dream.
The Progressive Bible
Since I have absolutely no authority to amend or alter the Word of God, who better than me to follow in the equally unqualified and arrogant footsteps of the secularists and do so anyway. True, I could be risking Hell by doing so, but Rob Bell has convinced me Hell doesn’t exist so I’m good to go. After all, if you can’t rely on a wannabe shaman peddling postmodernism in hipster glasses who can you trust?
Thus, to make the Bible more contemporary, inclusive, and progressive, here are my top 10 verses that need to be “updated” for our enlightened age.
10. In the beginning the god of your understanding watched the “big bang” occur, and then stood idly by for billions of years curious to see how this whole evolution thing would turn out.
9. For we so love the state that we give it our only begotten offspring. Whosoever believes in the state will not perish but get an Obama-phone and cash for clunkers.
8. Thou shall steal when it’s your “right”, when someone is “rich,” or when you’re a victim of white privilege.
7. Therefore, whatever god you recognize gave you over to the pure desires of your loins, to hit it with any consenting adult and/or organic orifice that floats your boat.
6. And one day every knee will bow, and every tongue will confess that god is whomever you need him/her/it to be.
5. Judge not lest ye believe in redistributing wealth, then judge much and judge harshly.
4. Do not murder, unless you’re going to be “punished with a baby.”
3. And Moses said to the theocratic authoritarian denying diversity in Egypt: “Let my people go into the wilderness so that they may recycle, commune with nature, and repent for their carbon footprint.”
2. Jesus’ mother came to him because the same-sex wedding party had run out of legalized marijuana. Jesus replied, “Maternal unit, why do you involve me? I am still buzzing from our last stash.” Jesus’ mother replied to the undocumented immigrants tending the wedding, “Do whatever he tells you.” So Jesus told them: “Puff, puff, pass man…puff, puff, pass.”
1. Jesus said, “I am a good moral teacher. Believe in what you will, for all roads lead to Heaven.”
For more blog postings from me, see TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH, POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC, AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena (Occasionally updated) and Coral reef compendium. (Updated as news items come in). GUN WATCH is now mainly put together by Dean Weingarten.
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Posted by JR at 12:41 AM