The Fuzzy Claims Used to Justify Cutting Social Security Disability Insurance
Republican leaders characterize the program and its recipients in ways that do not hold up to scrutiny.
Having already broken two planks of his campaign promise that “there will be no cuts to Social Security, Medicare & Medicaid” by proposing a health plan that includes brutal Medicaid cuts and lowers Medicare solvency by three years, President Trump has now cracked the door open on completing his broken promise hat-trick with up to $64 billion of cuts to Social Security Disability Insurance.
While certainly the proposed cuts to Social Security Disability Insurance do not sink to the depths of the potential cuts to Medicaid and SNAP (formerly known as food stamps), it is clear from the recent comments of Mick Mulvaney, the Office of Management and Budget’s director, that the Administration is already deploying selective—and often deceptive—facts to stigmatize and caricature both the Social Security Disability Insurance program and its recipients. Earlier last week, Mulvaney asked, “Do you really think that Social Security Disability Insurance is part of what people think of when they think of Social Security? I don’t think so.” On Monday he went further, asserting that he was sure “999 people out of 1,000” think Social Security Disability Insurance is not Social Security—despite the first two words of the benefit’s name.
This sort of framing justifies using Social Security as a piggy bank to raid in order to help offset tax cuts for top-earning Americans. Obscured are the facts that to even be eligible for Social Security Disability Insurance a person has to have worked five of the last 10 years, that the average person on Social Security Disability Insurance worked 22 years before getting benefits, that millions of such workers are now living with significant pain and disability, and that beneficiaries are often older Americans with less education who live in poor rural areas and former manufacturing communities—communities that politicians of every stripe, including Trump himself, have proclaimed to want to help.
And yet, despite Mulvaney’s claims as to what Americans believe, Social Security retirement benefits and Social Security Disability are all part of a single Social Security safety net designed to ensure that American workers can live with dignity when they retire or if they become too disabled to get gainful employment. Far from a separate program, Social Security Disability Insurance is a protection available to all Americans, and is paid for through the same Social Security payroll taxes that pay for retirement benefits. Cutting the program is cutting benefits for millions of the most vulnerable Americans in terms of income, health, and political power. Many may believe the program will never apply to them, but there is a one-in-three chance a young person at the start of his or her career will die or qualify for Social Security Disability Insurance before reaching retirement age.
Mulvaney’s statements echo oft-repeated, but quite deceptive, charges made against Social Security Disability Insurance, including that it is “a very wasteful program” that “grew tremendously under President Obama.” Far from spiraling, the number of people on Social Security Disability Insurance under Obama increased by about half as many as it did under George W. Bush, and the average annual growth rate under Obama was about a third of that under Bush. The number of beneficiaries has actually declined since September of 2014 by more than 185,000. And to Mulvaney’s claim that Social Security Disability Insurance is the “the fastest growing program,” he ignores that while disability enrollment decreased by nearly two percent over the past two years, the number of beneficiaries of Social Security’s retired-workers program increased by nearly six percent over the same period.
Even the larger claim that Social Security Disability Insurance has spiraled out of control over the last several decades does not hold up to careful scrutiny. No one debates that the size of the Social Security Disability Insurance program has increased since 1980. It is true that over the last several decades the Social Security Disability program has increased by 5.9 million beneficiaries. Yet, these numbers reveal little about a program without looking at demographic, social, and health trends.
The left-leaning Center on Budget and Policy Priorities has documented that roughly 80 percent of the increase over this period is easily explained by demographic trends. One part is the fact that both the number of people working overall and the aging of the population have led to a larger number of people who fall into the category of older workers who are more subject to the possibility of a work-inhibiting disability. Second, more than 28 million women have joined the workforce—with women’s labor-force participation rates rising more than five percentage points—making more women eligible for Social Security Disability Insurance.
Third, the increase in the Social Security retirement age from 65 to 66 has meant that more workers with disabilities in their mid-60s—who normally would have gone on retirement Social Security—stayed longer on Social Security Disability Insurance. In December 2016, more than 495,000 people between ages 65 and 66—over 5 percent of disability beneficiaries—collected Social Security Disability Insurance benefits. Jeff Liebman, a professor of public policy at Harvard, finds that, indeed, two-thirds of the enrollment increase since the 1990s is due simply to an aging population and the fact that more women with disabilities had extensive enough work histories to be eligible for the program in the first place.
Yet, these facts have not stopped critics of Social Security Disability Insurance from arguing that program reforms signed by Ronald Reagan in 1984 opened the door to an explosion of illegitimate musculoskeletal and mental-illness claims, leading to remarks like Kentucky Senator Rand Paul’s assertion that “over half the people on disability are either anxious or their back hurts.” It is true that since 1984 there has been a greater percentage of Social Security Disability Insurance recipients with musculoskeletal or mental-health issues. However, contrary to popular belief, musculoskeletal disorders and mental illnesses were already eligible before 1984, and constituted about 30 percent of beneficiaries before the change. The Reagan bill just clarified their eligibility for those categories.
With an aging population, it should not surprise anyone that musculoskeletal diseases would increase as a percentage of beneficiaries. An overview by Tim Zayatz, a Social Security Administration actuary, noted that demographic factors explained much of the increase in musculoskeletal awards. Likewise, the increase in mental-illness claims reflects less stigma and greater understanding of the realities of mental illness.
Another unfortunate claim made far too often is that Social Security Disability Insurance substantially discourages work, and is a significant cause of the declining labor-force participation rate for men. Yet, between 1996 and 2015, the number of men ages 30 to 49 who were not in the labor force increased by about 900,000, while over the same time period there was only a 0.5 percent increase—5,500 people—in the number of men in that group receiving SSDI. The White House Council of Economic Advisors has estimated that the decline in the labor-force participation rate is due to the aging of the population, cyclical decline due to the recession, and structural factors, and that of the 7.5 percent decline between 1967 and 2014, Social Security Disability Insurance increases may have caused only 0.3 to 0.5 percentage points of that decline. And while it is often claimed that no one ever leaves SSDI once they’re on, studies show 28 percent of beneficiaries are working or tried to work within 10 years of enrolling, and returning to work is even more common for younger beneficiaries, with 46 percent of beneficiaries under the age of 40 having worked at least one year in the decade after enrollment.
Beneath much of the conservative case against SSDI is a belief that it is going to the undeserving, that anyone and everyone can get benefits with false claims. Rarely mentioned are the more than six in 10 who start an application for Social Security Disability Insurance who never get benefits. An applicant has to go through a five-step initial approval process showing financial eligibility, severe impairment, and inability to work; less than a quarter of applicants are accepted. Only half of those who are initially rejected choose to then go through a four-level appeals process, in which only 14 percent of total applications are successful. Also rarely mentioned is that, next to South Korea, the United States has the most restrictive and least generous disability-benefit system of all OECD member countries.
In a program as large as Social Security Disability Insurance, are there ever serious or systemic cases of fraud? Certainly. But as with Medicare, the right way to do it is to target those engaged in major fraud through enforcement—not by cutting benefits or stigmatizing the millions of people who, due to pain and disability, are forced to live at times on a sub-poverty level payment of an average of $1,171 a month. The Bipartisan Budget Act of 2015 already stiffened penalties for conspiracy to commit Social Security Disability Insurance fraud, while expanding nationwide investigations.
Budget proposals say a lot about values. In this budget, Republican leaders have decided the country has enough resources for trillions of dollars of tax relief for the largest corporations and the wealthiest estates, but they are going to get tough by squeezing tens of billions of dollars out of a Social Security Disability Insurance program whose typical beneficiary is older, has worked for over two decades, has developed a disability, and is applying for a poverty-level subsistence to feed themselves and their families. And they can’t even shoot straight when they try to do that.