Containing the Disability Explosion
By: Robert VerBruggenNational Review Online
August 31, 2011
As recent news stories explain, the Social Security Disability Insurance Program (SSDI), which gives money to workers who become disabled, will be insolvent in six years. While the causes of this trend are various, a new book suggests that the solution might be simple: Encourage people with disabilities to work, rather than encouraging them not to.
The explosion in disability is easy enough to document. Over the last ten years alone, the number of disability recipients has grown by about 50 percent. The average award has grown faster than inflation.
A large portion of this has to do with the simple fact that our population is aging. As you can see on this spreadsheet, which I created with federal data, the increase in disability beneficiaries occurred overwhelmingly among those 50 and older - a demographic that is growing as the Baby Boomers join its ranks. For example, between 2000 and 2010, the number of Americans in the 55-59 age bracket rose by 42 percent.
But at the same time, the number of disability beneficiaries in this demographic grew by 73 percent - meaning that while the ranks of the middle-aged and elderly have swelled, individuals in these ranks have become more likely to claim disability. If Americans in each age bracket still went on disability at the rate they did in 2000, there would be 22 percent fewer beneficiaries.
An obvious explanation is that disabled people have had a hard time finding jobs over the last few years thanks to the rough economy, and have responded by convincing the government that they are incapable of work. However, according to data collected in The Declining Work and Welfare of People with Disabilities - a new book by Cornell economics professor Richard V. Burkhauser and Federal Reserve Bank of San Francisco economist Mary C. Daly - the disability rolls grew only slightly faster than normal during the recession. If the previous trend had held, the program would still be in trouble.
Read more: http://www.nationalreview.com/articles/275809/containing-disability-explosion-robert-verbruggen
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