How cutting jobless benefits expands the deficit

[one...two...tree 2,762]

The Wall Street Journal explains: After workers use up their insurance, they go on disability. That darn safety net

by Andrew Leonard

In Wednesday's Wall Street Journal, Sara Murray takes a pretty evenhanded approach to the question of whether unemployment benefits deter recipients from seeking new jobs.

The gist: There is some academic evidence of a mild inhibitory effect, but the severity of the current downturn -- including such realities as the fact that there are five job seekers for every available job -- likely negates that downside. Unemployment benefits are also considered an extremely efficient form of stimulus; recipients tend to spend their checks immediately, thus boosting overall demand in the economy.

It's a worthy contribution to the debate. But right now, the most popular story on the Wall Street Journal's Web site is a sidebar to the main story, also by Sara Murray, with the cognitively disjunctive (for the Journal) headline: "Cutting Off Unemployment Benefits Could Worsen Deficit."

Say what? Has the Journal seen the Keynesian light, and realized that the long-term deficit consequences of a slumping economy outweigh the short term spending pain of pumping cash into the economy, right now?

Not exactly. Older workers, reports Murray, have a much harder time finding new jobs than younger cohorts of the labor force. And when their unemployment benefits run out, they look for other forms of government assistance.

Unemployment checks have the added benefit of helping these people feel like they're still a part of the labor force. When the checks run out, and with few glimmers of hope in their job searches, they're more likely to drop out of the labor force and turn to a program like disability.

And unlike a relatively short-term fling with jobless benefits, their attachment to disability is more likely to be permanent.

I can already sense the conservative reaction to this analysis. If the answer to bad unemployment benefit incentives is to stop extending benefits, then the answer to the consequent turn to disability insurance has got to be to cut disability funding. Let's put both the unemployed and the infirm out on the street!

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[Usui Takumi 1,562]

How can a person go on disability if they aren't disabled?

[^_^ 5,021]

Older workers, reports Murray, have a much harder time finding new jobs than younger cohorts of the labor force. And when their unemployment benefits run out, they look for other forms of government assistance.

Boomers are such parasites.

[Ban Hammer 13,366]

How can a person go on disability if they aren't disabled?

i suppose when one gets old enough, they've got enough medical issues to get one of them to qualify.

[^_^ 5,021]

i suppose when one gets old enough, they've got enough medical issues to get one of them to qualify.

yeah, all you gotta do is find a cooperative doctor (there are lots of those).

[Obama 2012 1,714]

How can a person go on disability if they aren't disabled?

The same way a lot of people do. You gain 30lbs and claim to be fat.

Man it irritates me seeing those people. There's quite a bit of them too.

[Usui Takumi 1,562]

The same way a lot of people do. You gain 30lbs and claim to be fat.

Man it irritates me seeing those people. There's quite a bit of them too.

The Homer Simpson way!

Edited July 7, 2010 by Sousuke

[mawilson 2,133]

How can a person go on disability if they aren't disabled?

They can if they are fraudulent parasites.

1 in 5 Americans have some level of disability and 1 in 10 have a severe disability.

[DoneWaiting 15]

I could understand the elderly unable to find permanent jobs, but a young and healthy stallion? nothing new.. The insurance industry has been affected for year, doctors prescribing illness never existed and then disability, here they come.. All sectors are being affected from welfare to disability.. and then people like to talk about illegal immigrants, lol

[Deputy Purple 1,294]

1 in 5 Americans have some level of disability and 1 in 10 have a severe disability.

Wow, how stupid of me, for a period of about 3 years I had to use a cane on a daily basis as I had damaged one of my knees. I continued to work even though there were days that I couldn't even stand without using a knee brace and the cane.

I guess I should have got my hands on that list a lot earlier!

[Usui Takumi 1,562]

Wow I didn't realize that this was such a problem. So the government doesn't have auditors on this? Like a panel of doctors that verify claims?

[DEDixon 39]

if you have the private funds to retire early, it pays to find a way to start processing a disability claim just after you quit working. you get your SS early and SSI pays more than regular SS. my friend works at SSA and even he will make a disability claim for depression at age 55 because he has the funds to stop working. getting approved is mostly about not working. people usually get denied first time, but follow up claim often get approved.

around when i turn 53, i'm going to get super depressed..... thanks uncle sam.

[Pooky 3,795]

Wow I didn't realize that this was such a problem. So the government doesn't have auditors on this? Like a panel of doctors that verify claims?

You're kidding me, right?

The government investigating and clamping down on benefit fraud?

[Usui Takumi 1,562]

Disability for depression????? Your joking!!!

[Obama 2012 1,714]

Disability for depression????? Your joking!!!

It's a very serious disease and not a laughing matter....

At least that's what those on disability will tell you.