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November 20, 2010

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Two uncles of mine were NYC firemen. After retirement they put together a aluminum siding business. They did pretty good with it, but one uncle had to quit because he was basically living with pain from physical stresses caused by spending hours every day on ladders.

My brother in law worked as an electrician in Phoenix AZ until he retired on disability a couple of years ago at about age 60. Similar to my uncle, working on ladders, working on stuff up over his head for hours at a time, often working in Phoenix heat basically kicked the crap out of his body. He was living with more or less constant pain. When he got the notice that his disability claim had been granted, he stood in the kitchen and cried.

My wife's cousin works as a union construction guy near Akron OH. He can kinda do anything, but lately he mostly works concrete. He worked on the new museum in Akron, doing a lot of the more exotic concrete work on that building. He's about 50, most days he comes home and lies on the floor in the living room until his back stops hurting enough that he can get up, eat, and go to bed. Especially when he's working outside in the winter, as soon as he gets inside where it's warm he basically passes out, because it's freaking physically exhausting to just be cold for hours and hours and hours at a time.

I love hearing all the free market think tank guys talk about how everyone else needs to suck it up and deal. I'm guessing the last time any of them spent a day on a ladder, or in a crawl space, or exposed to serious heat or cold, or just generally busting their @ss in any significant way, was never.

Let alone actually physically ill, like Doc Science's friend.

Nice work if you can get it, I guess.

Sorry to hear about your friend, Doc Science, hope it ends well for her.

Same thing with the Social Security retirement age crap, and with the high-deductible health plans. Anything that has a redistributive component - even if the redistribution is purely insurance, that is, it is assigned on the basis of random unfortunate events that could happen to anyone - has to be attacked on principle. Because if you've been lucky you deserved to be lucky, and anything that makes life easier for unlucky people at your expensive, even if it's a marginal expense, is a grave injustice.

When it comes to disability it is the most annoying. In most cases disability funds are provided by regressive payroll taxes that are paid by ordinary workers and not through progressive income taxes. It's not just that they're uncharitable, it's that they want to be uncharitable with our money, which we specifically put aside for this purpose.

It's one thing to tell us we can't spend "your money" on something when we're talking about income taxes. It's quite another to tell us that we can't pool our own money from our own wages to provide low-cost universal insurance for ourselves.

It actually wouldn't be very easy to tighten the disability requirements. They already routinely deny almost everyone, no matter how good the case.

Great post, Dr. S.

Two thoughts.

First, though I never thought of it that way before, the NOSSCR quote makes me realize that deciding who gets disability payments is a standard false positive/false negative trade-off. That our emphasis is on stopping fraudsters at the expense of some genuinely disabled individuals is worth thinking about.

Second, I would like people like Biggs to be responsible for actually turning down applicants. Face to face. Make them review the file, decide who to reject, and then meet with those people and tell them they don't qualify.

Some years ago I was in the position of deciding whether the small company I worked for would buy disability insurance for its employees. This was, for entirely selfish reasons, a no-brainer. I wanted the insurance myself, of course, but I really, really did not want to be in the position of telling a disabled employee, "Too bad, pal. You've used up your vacation and sick leave, and you're not coming in to work, so we have to let you go. Good luck."

I bought the policy, and I bet (hope?) the AEI guy would too, if he had to deal with this at ground level.

I bet (hope?) the AEI guy would too, if he had to deal with this at ground level.

I will bet against you, Bernard. I don't think of the AEI as the place to go if you want logical, scholarly research, but if what you want is someone to look people in the eye while sentencing them to death for lack of money, they're your gang.

Arizona has now established Death Panels. About 98 people have been essentially marked for death by nixing their organ transplants. Although the legislature admits that their decision was based on fraudulent data, governor 'headless bodies in the desert' Brewer refuses to call a special session to correct it. By 'saving' 4 million $$$ the state foregoes significantly more than that in federal funds. Brewer also refuses to take stimulus money to temporarily bridge the gap.
Some people should pray round the clock that God is not just or not there at all, otherwise their resurrection could prove unpleasant.

Hartmut:

Leftists frequently say that conservatives accuse us of planning (or doing) things that they themselves would do -- projection. But I'm starting to think that it's not just a saying, but has real predictive power.

Is this something European conservatives do, too? Or is it Karl Rove's strategy?

"An underlying reason is that Congress has always believed that, given a chance, many people will "fake" disability in order to get benefits."

My brother got the princely sum of about $800/month on SSI disability, in an area where rent on a studio apartment near public transport (he can't drive) costs at least $500/month. Get a roommate to try to save on rent? Nope, they deduct the roommate's share of the rent from his payments. Become homeless - well you're not paying rent any more - payments lowered. Anyone who is so desperate as to choose the humiliation of constant investigations, checking for illegal roommates, appliances which seem too good for you etc. for such a pittance deserves our compassion - anyone, even if they're 'faking'. Mentally disabled? You don't seem retarded to me, says some random secretery in the SSI office. Benefits cut off. So, he has no access to his medication and winds up in the state psychiatric hospital for a hell of a lot more than $800/month. Benefits reinstated. Lather, rinse, repeat for the past fifteen years. An he has an educated, middle class family with two lawyers behind him. The system is repulsive.

angry: Anyone who is so desperate as to choose the humiliation of constant investigations, checking for illegal roommates, appliances which seem too good for you etc. for such a pittance deserves our compassion

One of the things that annoys me greatly when politicians of the left or right say it is the promise to cut costs through elimination of "waste, fraud and abuse". What that actually means is that many worthy recipients will be denied and every one of them will have their privacy invaded.

And regardless of that, I really don't care if a small percentage of the population are shirkers and just want to lie around at home. It doesn't matter. We have the capacity to produce far more goods than we need and it does not hurt me in the slightest to have them provided for free to the occasional lazy bastard. I'm not a Calvinist. Nobody "gets what they deserve". Everyone gets far more than they deserve, frankly, that's the nice thing about mass production.

You can't live high on the hog on disability, and if you're truly content to live that way you're probably not going to be a very productive employee even if you get a job. So what if some marginally productive workers stay home? Who cares?

People are so obsessed with making sure that someone else doesn't get something they don't deserve that they don't notice they're establishing a system in which they themselves get screwed all the time. Weird.

Jacob,

I think that we Americans mostly like to believe we live in something that at least vaguely resembles a meritocracy.

If that's true, then it's not hard to envision the rich as noble hard-working savers and the poor as a mix of the unlucky, unmotivated and just plain unworthy. In which case, one can cheerfully suggest that charity can handle the unlucky and everybody else can get what they deserve (or perhaps God will take care of it).

That's the mindset, near as I can figure. I recognize some of it in myself: I'd LIKE to believe that merit matters. I think it does, a bit. But not nearly as much as most people tend to assume - and that thought right there is what turned me into a liberal.

I had a conversation with a conservative friend of mine when the health-care bill was close to being passed during which he was complaining that providing public health insurance would cause more people not to work, and to live on the dole. It's not that I don't think some people would do that, but how many? And would their mere existence make public health insurance a bad idea on the whole?

The way I see it, people who think this way have one or both the following two beliefs:

1. There are lots and lots of lazy people, on a percentage basis, in the United States who would choose the most meager of existences, if they could avoid working, over the much better living conditions that work would afford them (in short, a generally dim view of humanity). Any additional thing that government might provide makes the choice of not working that much more attractive for this great many people.

or

2. More along the lines of what Jacob was saying, regardless of how many (few, really) of these people there are, we just can't have that. The idea that anyone would get some sort of free lunch is just too much to bear.

Belief 1 is poor perception, leading to a false premise, I think. Belief 2 is just bad thinking/poor logic. IMO, of course.

The panic about free lunches always reminds me of that econ experiment with two human subjects, one of whom decides how $10 is split between them and the other who can veto or authorize the split. The results of the study showed that the person with veto power consistently would veto an "unfair" split like $1 for the veto person, $9 for the other guy, even though it was actually losing him money to do so. People often enforce their conception of morality against their own best interests.

The idea of people choosing to live on the dole instead of working is bothersome to me. I accept it as part of the price we must pay in exchange for the benefits of a proper safety net.

hairshirthedonist - I think it's a mix of both your #1 and #2, but heavy on the #2.

providing public health insurance would cause more people not to work, and to live on the dole.

What "dole" are we talking about?

You can get unemployment benefits if you are laid off from a job. You have to have a job first, in order to get laid off. Quitting doesn't count. And, as folks are discovering, they don't last forever.

If you have no job, or a very poorly paying job, you may qualify for TANF benefits, which is the closest thing we have to straight up welfare. The requirements for qualifying for TANF varies from state to state, but it's federal money, and the feds require you to find a job within two years of getting your first check. Even if you have have kids, you're required to work at least 30 hours a week (single parent) or combined 55 hours a week (two parents).

There are food stamps, but they don't pay for anything other than food.

If you can demonstrate a disability, you can get Social Security money if you have have already paid enough into the system. Other than that, there's SSI, but you have to demonstrate an inability to work. And it ain't a lot of money.

Some states, but not all, have additional programs, which vary in what they provide and what is required for you to be eligible.

To my knowledge, there is no federal program that an able-bodied adult can qualify for that will allow him or her to spend their days watching TV, eating T-bones, and collecting government checks.

There is no "dole".

Here's what I don't understand about liberals. Everyone recognizes that the federal government is very harsh in its disability determinations. Every time you read a newspaper article about heartless insurance companies denying someone treatment, there is always a sentence mentioning that the hapless sufferer has also had his or her disability claim denied.

To this, the liberal responds by demanding a bigger role for the federal government in paying for health care. I just don't understand it.

Here's what I don't understand about liberals.

Yeah, the feds and the states will make you jump through 1,000 hoops before giving you a dime. No question about it.

We hate to give our hard-earned money to the undeserving, so we will by god require you to prove you are deserving. You might actually die in the process.

As wealthy nations go, the US is one [email protected] place to be poor.

What "dole" are we talking about?

That would be a question for my conservative friend and those who share his point of view. Be ready for some ill-informed and/or evasive and/or vague answers.

Sorry, I think I failed to provide the "liberal" perspective on the issue.

The CDC estimates that about 50 million people in this country went totally without health insurance for at least part of last year.

About half of those people have no regular source of medical care.

So yeah, government programs suck. They're bureaucratic, and inefficient.

But they are head and shoulders better than nothing at all.

The feds currently provide health insurance for everyone over 65, all active and retired military, a lot of kids, most of the poor, and a lot of the disabled folks in the country.

With all of what ought to be the most high-cost potential patients spoken for, the private insurance industry can't seem to make a sufficient buck without denying coverage for prior illness. Or without combing through folks' contracts whenever they make a claim to see if they can find some disqualifying nit that they can pick. Or without charging huge and ever-increasingly huge fees. Or without limiting coverage and requiring co-pays to the point where they strain the meaning of the word "insurance".

So lefties like me say the private market is not a reliable source of coverage, and since insurance is the gateway to service, and service (in this case) is basically essential to staying alive, it makes sense to move it into the public arena.

Not every piece of it, there will always be a lot of opportunities for the private sector to add value.

But everybody should be able to go to the freaking doctor a couple of times of year for a checkup, and have access to basic medical care.

That's my point of view, I speak as someone who self-identifies as being firmly on the left.

Every time you read a newspaper article about heartless insurance companies denying someone treatment, there is always a sentence mentioning that the hapless sufferer has also had his or her disability claim denied.

No, every time you read that story, that sentence does not appear. Becuase that is nt always the case. Or even most of the time. It's rare in fact. I mean, do you have any actual statistics? Percentages?

To this, the liberal responds by demanding a bigger role for the federal government in paying for health care. I just don't understand it.

Maybe I can help you understand.

First, the actual response as enacted into law was to require that insurance companies can't rescind or deny coverage for a pre-existing condition.

However, to the extent that both the govt and the private sector will deny a given claim, and the goal is to get the person in question coverage, then the solution would NOT be to let the private sector handle it.

Since the private sector already denied the claim, leaving it up to the private sector would result in the claim being denied. Period.

If the government denied the claim as well, then the only solution would be to change the government's approach by either expanding the circumstances under which the govt grants claims, or using the legislature to force the private insurers to do the same.

Regardless of liberal/conservative, those are the choices if the goal is to increase the number of claims granted.

Russell,

Yeah, the feds and the states will make you jump through 1,000 hoops before giving you a dime. No question about it.

We hate to give our hard-earned money to the undeserving, so we will by god require you to prove you are deserving. You might actually die in the process.

It would not surprise me to learn that loosening restrictions would actually save money in two ways. FIrst, it's not cheap to go over applications with a fine-tooth comb, looking for ways to deny coverage, then dealing with appeals. Letting a few more liars through the first time might actually be cheaper.

Also, consider the case of Angry's brother, above. The disabled do not disappear. If they show up in hospitals or otherwise require special care later that will be costly also, and if paying regular disability benefits can avoid that it might well be financially wise.

And of course, this does not take into account the real social costs of the various delays, hassles, and rejections faced by legitimate claimants. Among other things, it seems that a great many rejected applicants are granted benefits on appeal when they hire a lawyer. Lovely. Take someone struggling financially, and force them to spend money on legal fees to get some help, not to mention enduring whatever while they wait for it to be resolved.

As I said above, there is no doubt that a looser system will allow some fraudulent claims to be paid. But is there any proof that the overall costs would be higher, especially when you include the social costs that do not show up directly?

Good points, BY.

After re-reading what I wrote November 22, 2010 at 01:35 PM, I think I need to provide a better answer about "what dole?" than I did, since I did allow for some people chosing to "live on the dole."

The usage of dole a reflection of my friend's characterization of one or more of the programs russell mentioned. The point being that, in discussing the potential for fraud, you are acknowledging that some able-bodied people will take, for instance, SS disability if they can get away with it. Or stay on unemployment a bit longer than necessary. I agree that it's not a lot of money, and I doubt very many people would choose to live on such a small amount of money if they could, in fact, go out and earn more money by working. And I doubt there's much of a margin between the number of people who would do that if, say, they could receive some form of public health insurance versus the number who otherwise would.

So, while there may be no official dole, public assistance can be abused and used as such. But I don't think it's a big enough problem to justify draconian policies that would delay or prevent legitimate claims, because I don't think there are that many abusers, and because I don't think preventing any and all abuse should be the primary goal.

(That and what Bernard wrote. The filter costs money, and its returns may very well diminish below the marginal costs at some point - not to mention just effing up people's lives.)

My position is that I want a quid pro quo.

For every deadbeat layabout we track down who's living la vida loca on something less than $1,000 a month of public money, I also want the scalp of a Congress person who's trading votes for a fat post-public-office gig, or of a military contractor who's making millions padding out a cost-plus contract, or of a banker who's throwing millions around to beat down capital requirements, or of a pharma CEO who's throwing around millions to try to beat down requirements on how much premium revenue has to actually be spent on health care.

Any of of the folks on my short list here p*ss away, directly or indirectly, enough public money in about ten minutes to keep our lazy bum in Big Macs, cheap beer, and a cable subscription for about 100 lifetimes.

Fair's fair.

Countries with generous and fairly lax standards for public assistance do seem to (in an anecdotal sense) to end up with a population of shirkers - marginal workers who may or may not work at any given time, and when they do work often work under the table.

They still function as societies. Most people still get jobs and go to work. The garbage still gets picked up and water still comes out of the faucet. The rest of the population still enjoy high standards of living.

And there are some ancillary benefits to it, like reductions in homelessness. Some people are just terrible at getting along with modern society. They can't fit in. They can't figure it out. You can choose to lock them up in jail when they resort to crime, you can tolerate them as homeless, or you can accept it and figure out how to help them.

By my standards "help" ought to include "help on getting along in modern society", rather than being a monthly check with no strings attached. Work placement and training are important. The EITC is a good way to get people into work without falling into a gap between benefits and paychecks.

For quite a bit of my early life, our household was supported by a British program that is roughly equivalent to TANF. My mother worked as well (mostly under the table because of a lack of an equivalent to EITC). I cannot imagine what a single mother with three children could have managed without support. (She had us while she was married, but not all marriages work out.) I have no idea what people imagine would happen if these anti-poverty programs were cut off. People talk about private charity, but charity tends to be very local, and given the extreme separation between economic and racial groups in this country, that isn't a practical way to address the problem. Other than the obvious moral problems with uprooting people, outplacement of groups of poorer people in richer communities would need to happen for a practical private charity approach to work. And given that most richer communities are expressly formed for the purpose of getting away from poor people, I somehow doubt that's going to fly.

Any of of the folks on my short list here p*ss away, directly or indirectly, enough public money in about ten minutes to keep our lazy bum in Big Macs, cheap beer, and a cable subscription for about 100 lifetimes.

If someone could make this point effectively to some portion of our Tea Party brethren, perhaps we could find common ground.

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