What Entitlement Program Will Go Broke First?

What Entitlement Program Will Go Broke First? by Sean Hackbarth on FreeEnterprise.com

What federal entitlement program is closest to fiscal collapse?

Medicare? No.

Social Security? Negative.

Medicaid? Uh-uh.

While the three above are in peril, the “award” goes to the Social Security Disability Insurance Fund (SSDI), which is expected to run out of money in 2016.

In the Wall Street Journal, economist Michael Boskin notes the explosion in the people using it and SSDI’s costs:

The number of people collecting disability benefits has soared, especially in recent years, to almost 11 million in June, up from 2.7 million in 1970. The 2012 price tag was $140 billion, up eightfold, adjusted for inflation, from 1970.

In a 2011 paper, MIT economist David Autor put these costs in the context of the rest of the federal budget [h/t Reihan Salam]:

In 2010, SSDI cash transfer payments totaled $124 billion, while the cost of Medicare for SSDI bene?ciaries was $59 billion. These outlays, exceeding $1,500 for every U.S. household, comprised 7.3 percent of federal non-defense spending last year—a sum that is larger than interest payments on the federal debt. In the last two decades, outlays grew at 5.6 percent in real terms, compared to just 2.2 percent for all other Social Security spending. As a consequence SSDI’s share of total Social Security outlays has risen from one in ten dollars in 1988 to almost one in ?ve dollars at present. Perhaps most ominously, SSDI expenditures now exceed by 30 percent the payroll tax revenue dedicated to funding the program.

By expanding the medical conditions that qualify and increasing payments, SSDI has turned into something it wasn’t originally designed to be writes Boskin: “Disability insurance has clearly become, in part, a form of extended unemployment insurance and early retirement, with Medicare benefits.”

This was covered by FreeEnterprise.com in April:

[A]n extensive April 10 report from the Wall Street Journal dug into the explosion in Americans covered by the Social Security Disability Insurance Program since 2007. The number of Americans on federal disability grew by a half million over the course of the 2007-2009 recession, from 7.1 million to 7.6 million.

But since the recession’s end in June 2009, that number has swelled to a historically high 8.9 million. That’s more than double the number of disability beneficiaries in the 1990s, according to Jordan Weissman in The Atlantic, who notes that the eligibility requirements for disability have been relaxed at the same time jobs have grown more scarce.

A significant proportion of the former workers on disability are below the age of 50, the Journal notes. Based on the statistics, it’s unlikely that these workers will rejoin the labor force. In 2011, the Journal report finds, only .5 percent of disability recipients left the program to return to work.

In March, a National Public Radio (NPR) reporter explored the growth of the disability rolls and found that the disability program was essentially serving to “hide” workers who may not be disabled, but are otherwise unemployable due to changes in the economy—suggesting the real unemployment rate is significantly higher than the official 7.6 percent rate.

"That's a kind of ugly secret of the American labor market," David Autor, an economist at Massachusetts Institute of Technology, tells NPR. "Part of the reason our unemployment rates have been low, until recently, is that a lot of people who would have trouble finding jobs are on a different program."

[As a side note, the fact that millions move from being unemployed to being disabled indicates how weak our economy is and how critical pro-growth, job-creating policies are.]

To prevent the SSDI’s collapse Boskin recommends that the program better target the truly disabled:

Eligibility should emphasize objective medical—as opposed to more subjective and vocational—criteria, with a more rigorous appeals process for potential false rejections of meritorious but difficult-to-verify claims. About 40% of disability awards now follow appeals, of which a large majority are successful.

Next, offer better incentives to return to work for those who can. This means early intervention and providing information about job options—before people lose any attachment to the labor market and their skills deteriorate. Today, the disability-insurance program hardly focuses on the return to work. It is a Hotel California—you check in with a disability and don't leave unless you die or convert to Social Security retirement at age 66. In 2009 only a tiny percentage of those on disability, 0.8%, returned to work or gave up the benefits for other reasons.

He hopes fixing SSDI can be a springboard to broader entitlement reform:

With luck, the looming implosion of the Disability Insurance Fund will focus attention on other entitlements (and may dampen some of the happy talk now heard in Washington about the health of Social Security and Medicare). Coming to grips with the disability program also may provide a guide to reform of the larger programs.

The clock's ticking on SSDI, and we can't afford to ignore it.

xxxxxxxxxxxxxxxxxxxx CATP - Black conservative Deneen Borelli blacklisted from NAACP Convention The NAACP (National Association for the Advancement of Colored People) was founded “to ensure the political, educational, social and economic equality of minority group citizens of the United States and eliminate race prejudice.” The organization claims it “seeks to remove all barriers of racial discrimination through the democratic processes.”

Well apparently the NAACP has erected a barrier of its own and blacklisted black conservative, Deneen Borelli.

Borelli, author of book Blacklash: How Obama and the Left Are Driving Americans to the Government Plantation, and Fox News commentator, and her husband, Dr. Tom Borelli, were told there was no room at the 104th conference when they tried to pay for booth space. Photos of the venue, however, clearly showed plenty of available space.

But there was no room at the inn for Doreen and husband, who might have upset the new NAACP meme of discrimination for all BUT black liberals who tow the race-baiters’ line.

The organization once formed to ensure black people could strive, on an equal playing field without fear of bodily harm, to achieve their dreams in America, now only protects the struggles and aspirations of liberal blacks.

Political Conversation with a Young Woman

I was listening to Mark Levin last night when he admonished everyone to get out and talk to people about what is at stake in this years Presidential election. So he gave me the idea to recount a conversation I had with a 29 year old young lady. The conservation started about the argument to legalize drugs or NOT!,....the Tea Party,.....illegal immigration,.....and then into alternative fuels, where I pick up the conversation.....

Me: "You're right, we need to be able to use waste products to create bio fuels. I fully support research into that."

Young Lady: "Yeah but, the technology is current. Lots of people make biofuels now for diesel vehicles."


Me: "You are correct, but the production costs are so high to manufacture bio fuels is that conventional petroleum products are infinently cheaper."

Young Lady: "Well at least you can say that Obama is on the right track developing solar and wind power so we don't have to pollute so much."


Me: "Obama hasn't done anything except give away tax payers money to solar firms that have all failed, and failed to pay back the government, again tax payers, money."

Young Lady: "Well, Obama is also drilling more oil, so I guess he is hedging his bets. I heard or read that under his leadership there is more drilling than ever before."


Me: "First of all, leadership is a contradiction in terms when used in the same sentance with Obama unless you also use an adjective such as failed. Secondly there is more drilling being done, but all on private lands despite Obama's efforts and efforts of his Justice Dept and the EPA to keep these drills from being struck. Thirdly, there is much less oil drilling on public lands and waters than every before since Obama through up EPA road blocks to drilling. Plus the price of gasoline is twice as high now than it was under Bush. That's energy progress?"

Young Lady: "If this is true, then how come I haven't read about this or see this on the news?"


Me: "Well,......try this experiment. Listen to CNN, ABC, CBS, MSNBC and NBC objectively and see how many pro Obama and pro-Romney and how many anti-Obama and anti- Romney articles or news segments there are. I think a rational person will conclude that all these legacy news sources will be decidely slanted towards projecting favorable coverage of Obama and un-favorable coverage of Romney.

Young Lady: "How is the average person supposed to know what is truth or not?"


Me: [What I wanted to say: "If Obama's or a liberal's lips are moving - they are lying"]....what I did say: "It is up to you to become an educated voter. You have an obligation to vote and you have an implied obligation to be educated before you vote."

Young Lady: "Yeah, you're right. I need to be informed on the issues. How do I go about doing that?"


Me: "I look at all different sources. I suspect the sources that use judgemental verbiage as opposed to just reporting on the news. I am also a conservative and identify myself with the tea party so some of the news sources I follow may not be as diverse as you would like. Fox News, hands down, is the most objective. Do not confuse their commentators such as Hannity with objective reporting. While I feel Hannity tells the truth, he is a conservative commentator.

Young Lady: "Well, I just don't want to watch nothing but people tearing Obama down."


Me: "Fair enough,...but can you give me one,....just one thing that Obama has done to make this Country better other than become the first black President and therefore seemingly overcoming the racial ceiling?"

Young Lady: "Passing Obamacare has to his premier accomplishment."


Me: "Bear with me a minute,.....I am going to ask a couple of questions then give you the answer.......When the Obamacare bill was finished and went before Congress was it published on the internet for 48 hours so the public could read and provide comment? and Who actually passed Obamacare"?

Me: "The Obamacare bill was passed by a Committe missing any Republican representation. The Democrats shut the Republicans out of the process. Then sent the bill to Congress for a vote. The republicans asked to read the 2,700+ page bill before they voted. The Democrats would not allow it and demanded an immediate vote. This is where Nancy Pelosi, then Speaker of the House, declared that 'we must pass the bill to find out what is in it'. The Democrats had a majority in both houses,...passed the bill, then sent it to the President for signature. The rest is unconstitutional history."


Young Lady: "Well, I don't know that to be a fact."


Me: "You have to educate yourself,......continue to bear with me a minute,.....Does Obama say that Romney is going to destroy Medicare for Seniors?"

Young Lady: "Yes".


Me: "Romney and Ryan declare they will leave Medicare alone for seniors and those 55 years and older, but need to fix Medicare because it is going broke. Did you know that Obama took out over $700 Billion dollars from Medicare to fund care for welfare recipitants and illegal aliens under Obamacare?"

Young Lady: "No. I haven't heard that."


Me: "Well, I guess you have some work to do".

I said goodbyes and left. This young lady talked to wife afterwards and said "your husband gave me a lot to think about. It seems that the truth is hard to find."

My wife replied " Indeed it is.........if you're a Liberal"

More Obama Campaign Lies

Surprise!! The Obama campaign has released yet another Television ad lying about Romney and Medicare, so it's technically a "two for".

Here's the lies: "Barack Obama will protect your guaranteed benefits and will not allow Medicare to become a voucher program,” "Mitt Romney would take away Medicare as guaranteed benefits and instead give future retirees ‘premium support’ or vouchers.”

Despite Romney and Ryan's statments that Medicare would remain the same for all person 55 years and older,...and,...based on the indisputable fact that Medicare has to be reformed at some level because it will go backrupt in 8 years,......and despite the fact that Obama and the Democrats were the one's who took $700+ billion away from Medicare putting seniors in great jeopardy in order to pay for Obamacare, the Democrat Lie machine, lead by Obama, continue to try and scare seniors. Pitiful and Pathetic.

Here's what people on the interent say about the most recent Obama lies:

First the Idiots:

"Shame on ABC for being a racist against the guy who is half Black and half White. It’s not okay to be a racist but it’s okay to be a reversed racist. Anything against Barrack Hussein Obama is racist and hates." Posted by: acd2012

"Liars. Everything Mr Obama says is easily proved to be correct. To state otherwise is simply racist." Posted by: Gobama

Now, the honest people:

"GOBAMA: It’s people like you that are dividing this country. YOU are the racist here, since you believe the only reason someone can call Obama a liar is because he’s black. YOU are the racist for wanting to protect him simply because he’s black. " Posted by: S-LA

"What do you expect from a nation divider and racebaiter? Obama VS AMERICA" Posted by: Yep I said that

"What’s the similarity between a cheap rug and Obama? They both lie". Posted by: Marc

"There is only one reason why AARP opposes the voucher system and it has only one thing do with its membership: captive insurance sales. AARP sold out its membership when it supported Obamacare and a planned $900 million reduction in Medicare spending simply because it represented an increased opportunity to sell the insurance products it represents. The way that AARP supports it’s membership, anyone can do anything to any senior as long as it does not disrupt the commissions from insurance sales." Posted by: wantingbalance

"Welcome to liberal America where lies are the normal and where incompetence is rewarded on the same level as success. Where everyone feels they are entitled to everything and should have to only put in the minimum effort for said entitlements. And responsibility is someone else’s problem. Liberal Americans are always always right and if something does go wrong well then it must be someone else’s fault. If you disagree with liberal Americans well you are called every name in the book, “Racist”, “Radical” or “Extreme” are just some of the favorite names used by the liberal Americans. Look at the very first post here!! This mentality will only get worse if Oblammer is re-elected. So when did it become extreme or radical to live within your means? Bottom line is we need a long term fix not a short term just re-elect me type fix. What we don’t need is more divisive tactics used by Team Oblammer. I guess for liberal Americans these actions equate to moving FORWARD!" Posted by: frankieworks

Best Primer on Obamacare

Sometimes, somebody makes a concise argument presenting undisputed facts and figures to clearly present the truth. The below video is as short and clear, not to mention factual, as you will find on obamacare and the timeline for it's implementation. I wish all AMericans, especially Seniors could see this.

One Look at the Ryan Budget Plan

With Romney announcing his pick of Rep Paul Ryan to be his VP choice, previous Obama, Biden, Pelosi, and bucked tooth Wasserman-Schultz attacks on Ryan's budget plan are re-surfacing. Seems kind of hypocritical that the Democrats, who have no plan of their own besides borrowing more money and instituting higher taxation, are banging on Ryan's plan.

And make no doubt about it, the Democrats will make Ryan's plan and therefore Romney's fiscal platform out to be a death sentance on the elderly. Obama has no choice to demonize Romney and Ryan, since he has no plan of his own and is running scared,....Obama cannot run on his own record which history will show as the worst administration in history.

The below is Yahoo!'s lay out of the five key points from Ryan's "Pathway to Prosperity" budget.

1. Ryan's budget plan cuts $5.8 trillion over 10 years from projected federal spending and reduces the deficit by $4.4 trillion over the same period. Discretionary spending, which includes programs like food stamps, would see more than $900 trillion in reductions. The budget also calls for the repeal of President Obama's health care reform law, which supporters say would save billions in federal subsidies that will be given to lower-income people to buy insurance.

2. The most contentious part of Ryan's proposed budget are the changes to Medicare, the nation's insurance plan for retirees and a political third rail. Ryan's plan would eventually transform Medicare into defined payments that seniors can use to buy private insurance or a government plan on an insurance exchange.

There would be no limits to the out-of-pocket costs seniors could pay in this program, but Ryan assumes that the increased competition between Medicare and private plans would bring down overall costs. The amount of money seniors get to buy insurance would grow at a slightly higher rate than GDP each year. (The Congressional Budget Office says this would save the government money, but also significantly increase the amount seniors will eventually have to pay for their own insurance.)

The eligibility age would gradually rise to 67, from 65. Democrats say this transforms Medicare into a "voucher program" that may leave seniors with big prescription bills and other medical costs, and the Obama campaign is already using this against Romney and Ryan. If Obama can convince seniors--a powerful voting bloc that turns out at the polls--that Ryan would worsen or weaken Medicare, it could mean bad news for their campaign.

Cowboy's comment: Don't forget about Obama taking $500 billion from Medicare to pay for Obamacare, even though he granted waivers to all his Union friends."

3. Ryan would cut the top federal income tax rate for individuals and corporations to 25 percent from 35 percent. The budget says some tax breaks and loopholes would be eliminated to help offset the revenue loss.

Cowboy's comment: This puts more money back into the pockets of those who earned it, and less for those who would steal it - read the Federal Government. This additional money provides working capital so businesses can expand, creating more jobs and therefore more people wth health care insurance and more revenue for the Federal government.

4. Ryan would slash Medicaid, the insurance program for some low-income people, by $735 billion over ten years, and hand the program back to the states to administer with more freedom. The CBO writes that states would most likely have to "reduce payments to providers, curtail eligibility for Medicaid, provide less extensive coverage to beneficiaries, or pay more themselves than would be the case under current law." 5. The budget spares Social Security and defense spending, which are left at current levels.

Ryan's decision to back off Social Security is interesting, since he put forward proposals to privatize the program around the same time that President George W. Bush tried to sell the nation on a similar proposal. (Social Security does not face the same solvency challenges as Medicare and Medicaid, and is not projected to grow much as a percentage of GDP over the next 20 years.)

Cowboy's comment: What is missing from Yahoo!'s commentary on the Ryan budget plan is the consequences from failure to act. Obama has driven this country to unprecedented amounts of Federal debt and annual deficit. We are approaching $1 trillion in deficit spending this year and have over $16 Trillion in debt,.....over $5 trillion from Obama's administration alone! There is no mistake about it,....failure to act,... and act boldy will collapse this country.