Like Halley’s Comet, the idea that people are faking disability claims reoccurs with regularity. The recurrence doesn't happen seasonally, but politically: Republicans are more likely to propose to cut disability benefits. In 2019, it is Democrats opposing the Trump Administration’s proposed Fiscal Year 2020 Budget, which targets people with disabilities. Sadly,
Cutting Benefits Is Bad Economic Policy
By cutting funding to programs that directly aid people with certain kinds of disabilities,* research the causes of disability,** and help the disabled be fully engaged citizens,*** we are missing a chance to engage a productive workforce. Simply put, it does not make economic sense to cut programs that help people with disabilities work, live in their own homes, get to their jobs, and access the opportunities that all Americans enjoy.
Unfortunately, the Trump Administration is proposing to take a system that is already inadequate and make it worse. Integrating working-age adults who are disabled is part of an economic strategy and the choice is stark: Do we have a society and suite of policies aimed towards engagement or warehousing? Currently, the U.S. leans too much toward the latter.
Comparative studies find employment rates of disabled workers are relatively high in Nordic countries. In Sweden and Denmark the disabled are much more likely to work because these nations with social-democratic systems more successfully integrate individuals with adverse health conditions.
In the U.S. and U.K., meanwhile, disabled workers are more often unemployed and otherwise excluded from the labor force, thanks to an excessive focus on the development of workfare programs that encourage labor force participation as the principle means of achieving equality. Indeed, the cost savings sought by the Trump Administration have to do with a proposal to “test new approaches to increase labor force participation.” This approach has resulted in a limited policy focus that fails to account for all the economic and cultural steps needed to ensure parity of participation of people with disabilities. Investments in active labor market policies may improve the employment of chronically ill people.
U.S. policy has provided little incentive for employers to economically engage disabled people. First, we do not have a cultural commitment to ensuring that workers with disabilities have the opportunity to work in the paid labor market; in fact, research suggests that accommodating people with disabilities is sometimes seen as unfair. Second, U.S. employers have little financial incentive to help disabled workers stay on the job, since the government does not coordinate employer actions with the employees’ particular needs.
Research shows the obvious: bad health is one of the main determinants of early retirement. But depending on the policies of a nation, bad health does not necessarily constitute a barrier to labor force participation. Working depends foremost on the broader context of an economy and policies which can either promote or hinder the employment of workers who are not entirely healthy.
Included in the proposed $72 billion in cuts to disability programs are reductions in Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI). Not only is this a betrayal of Trump's campaign promise, it hurts one of the most vulnerable groups in the country.
SSDI allows individuals under retirement age, after two years of demonstrated disability, to get disability benefits and Medicare. Since the disabled often quit their careers early, the benefits are quite low—the average is $1,234 per month. And despite perennial accusations of fakery from the right, the disabled are some of the most vulnerable in society. As a group they aren’t faking it—people on disability are three to six times more likely to die than people in their age group who are not on disability.
The U.S. has always had among the lowest levels of long term disability recipiency. It is quite difficult to get on SSDI—less than 4% of the working age population receives such benefits—though the rates have increased over the last thirty years. While opponents of disability benefits might see this as evidence of falling standards, the basic reason for the increase is that millions of women entered the workforce in previous generations, and thus became eligible to apply for disability.
Crucial to understanding the stubborn persistence of disability is to recognize that in determining disability, the SSDI program considers a number of factors in addition to a person’s health impairment, such as the level of accommodation offered in the workplace and the wages and working conditions of the jobs available. Disability means more than having difficulty with routine activities. Eligibility requires a worker be “unable to perform any substantial gainful activity on any job in the economy for at least one year.” The “substantial gainful activity” refers to any job that generates earnings of $1,180 per month for most people anywhere in the national economy.
The economic environment has a lot to do with whether a person applies for disability. Structural changes in the economy, including declining job and wage prospects for low-skilled workers, have made disability benefits more attractive, as the Economic Policy Institute has shown. This effect is difficult to quantify, however. It is much easier to get someone to stay in the labor market with their physical and mental disabilities than it is to get someone who has left back into the market. That is why programs that help the disabled stay engaged and be accommodated at work are important and practical.
What Is Next For the Disabled And Those at Risk of Disability?
On April 2, Senators Bob Casey (D-Penn.) and Sherrod Brown (D-Ohio) wrote to Trump’s budget director Mike Mulvaney stating their concern about the cuts and asking to restore the recommendations for funding. As the Senators wrote:
“You have proposed $84 billion in cuts, chiefly, to Social Security Disability Insurance. These are funds that support hard working Americans who have developed disabilities over the course of their lives. The workers who would be denied benefits under your cuts are people who have not only contributed to our economy over decades but have also paid into the Social Security Disability Insurance fund. Our government promised American workers that if they work, grow our economy and they develop a disability – we will take the funds they have contributed in their taxes to provide some care, relief, and dignity.”
Trump's cuts won’t help the disabled work. And in the end that is exactly what a sensible policy should do.
* Examples include the Traumatic Brain Injury program, the Paralysis Resource Center, the Alzheimer’s Disease program, the Lifespan Respite Care program, the Autism Surveillance program, the Independent Living Centers, the Limb Loss Resource Center, Gallaudet University, and the state Council on Developmental Disabilities.
** Examples include the University Centers on Developmental Disabilities, the National Institute on Disability, Independent Living, and Rehabilitation Research.
*** Examples include the Voting Access for People with Disabilities program, state Assistive Technology programs, the National Family Caregiver Support Program, the Native American Caregiver Support Services program, the Interagency Autism Coordinating Committee, the Office of Disability Employment Policy, and Section 811 Housing for Persons with Disabilities.