Disabled fund Social Security injury $$$ viable only until ’16

Disabled fund
Social Security injury $$$ viable only until ’16

By JOHN AIDAN BYRNE
Last Updated: 12:17 AM, June 9, 2013
Posted: 10:05 PM, June 8, 2013
America’s much-vaunted Social Security Disability Insurance program is on the verge of collapse, a shocking new study reveals.

In just 36 months, the enormous safety net for millions of American workers classified as disabled is forecast to run out of money.

And the flow of projected incoming funds propping up America’s fastest-growing entitlement — which cost $132 billion in 2011 and now costs more than food stamps and welfare combined — won’t be enough to offset a 20 percent cut in payments by 2016, the 2013 Trustees Report on Social Security discloses.

The Disability Trust Fund “does not satisfy the short-range test of financial adequacy,” the government report adds.

As many as 4.2 million Americans now draw Social Security disability payments — taken from a fund separate from the retirement pool — which can amount to as much as $13,000 in benefits annually, Medicare included. This is a staggering, near-threefold jump in the past two decades.

The impending disaster has policy analysts reeling. And it raises the stakes for lawmakers already in pitched battles over federal budget and entitlement reform.

“The report underscores a serious underfunding problem,” Melissa Favreault, a senior fellow at The Urban Institute think tank, said.

“More people are going to need disability benefits, and more are going to need retirement benefits as well, and that is a large aspect of this problem.”

Some, however, saw this coming.

“I don’t think we are surprised, because it is the kind of growth we have seen in other welfare programs,” said Rachel Sheffield, policy analyst at the Heritage Foundation.

Last week New York City released May figures showing the number of residents on food stamps, or Supplemental Nutrition Assistance Program. They were basically unchanged from April’s, at 1,871,135. That’s 427,000 more residents on food stamps since May 2009.

Back then, the city’s seasonally adjusted unemployment was at 8.7 percent, compared with today’s officially lower 8.4 percent.

The disability program assists many deserving individuals, analysts stress.

But critics say its growth has been fueled by a surge in long-term unemployment and changing qualification standards.

“The loose standards and broad net that have crept into the system have spawned a parasitic ecosystem of disability lawyers, willing doctors and lax judges who cooperate to certify millions of undeserving Americas as disabled,” according to Gary Shapiro, CEO of the Consumer Electronics Association, a trade group.

The Trustees Report warns that Social Security, along with Medicare costs, will grow far in excess of gross domestic product through the mid-2030s. That’s fueled in large part by a rapidly aging population and declining birth rates.

The Trustees Report adds that the entire trust fund for Social Security, which showed a slight rise in its deficit from last year, will be “exhausted” by 2033.

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