Build it and they will come … no we are not talking about a baseball field, but rather government entitlements. If there are entitlements available, people will use them; correctly, by stretching the truth or by outright fraud (although we rarely label it as such). That is the case with the Disability Insurance (DI) portion of Social Security.
In recent years the number of beneficiaries has grown considerably with the program becoming little more than an extension of unemployment for many. DI claim, appeal and follow up processes have often been criticized by government audit agencies, but merrily we roll along into insolvency. Can you imagine the political upheaval if the program was forced to operate as intended, that is, to pay disability benefits to individuals truly unable to work. But you see that’s the trouble with entitlements. The minute they are adopted people start to find ways to get more, to expand them because they are not good enough. You can see the same thing happening with Obamacare where regulations and rules expand the benefits and raise overall costs under a law labeled the affordable care act. As George Meany once said when asked what unions wanted; “more” is what everyone wants and the consequences to everyone else be damned. Politicians are more than willing to oblige because happy voters mean votes for those who deliver one new entitlement after another.
Sooner or later we must ask how this will be paid for and who will pay. Sadly human nature prevents us from implementing programs that serve the necessary purpose of only helping those truly in need.
From the 2013 Social Security Trustees Report:
However, the DI Trust Fund fails the Trustees’ short-term test of financial adequacy. The Trustees estimate that the DI trust fund ratio was at 85 percent at the beginning of 2013. After 2013, the projected DI trust fund ratio declines until the trust fund reserves become depleted in 2016…
The Trustees project that the OASI Trust Fund and the DI Trust Fund will have sufficient reserves to pay full benefits on time until 2035 and 2016, respectively. Legislative action is needed as soon as possible to prevent depletion of the DI Trust Fund reserves in 2016, at which time continuing income to the DI Trust Fund would be sufficient to pay 80 percent of DI benefits. In the absence of a long-term solution, lawmakers could choose to reallocate a portion of the payroll tax rate between OASI and DI, as they did in 1994.