Chairman Enzi: Modernize Disability Insurance to avoid program insolvency
U.S. Senator Mike Enzi, R-Wyo., Chairman of the Senate Budget Committee, spoke this morning about the looming insolvency of the Social Security Disability Trust Fund. In his opening statement before the Senate Budget Committee, Enzi highlighted the need to modernize the Disability Insurance program in order to fiscally secure its long-term future for the nation.
Below is U.S. Senator Mike Enzi, R-Wyo., opening statement as prepared for delivery:
The federal government’s primary program to assist the disabled will soon be broke. And, regrettably, President Obama isn’t doing anything to ensure that this never ever happens again.
His effort to paper over the problem is a classic example of Washington ducking a real American need. In this case, disabled Americans and workers deserve a long-term solution so that the program that doesn’t once again flirt with disaster and, more importantly, reflects the full ability of the disabled to contribute their talents to our country.
As Budget Committee chairman, I have the ability to look closely at the operations, functions, and programs of the Federal budget. How are they working? What is their impact on our budget bottom line? Are there ways to fix what doesn’t work, to improve the program and help our budget?
One of the most amazing programs we have, which touches so many Americans in very critical ways and impresses the world, is what we do to support the disabled.
America is a large-hearted country. And in reflection of our caring for some of the neediest among us, for almost 60 years the Federal government has operated a disability insurance program.
The program’s concept is simple: employed Americans pay a small tax. In the event they ever become disabled, the program provides them support because they can no longer work and earn a living.
This year, the disability program will benefit up to 11 million Americans.
These beneficiaries are our constituents. They had jobs. They paid a tax into the system. Then, in some way at some point, they became disabled. They could no longer work, or earn a living, or support a family.
This is where the disability program stepped in. It lent an able hand of support so that potential income lost was in some way offset.
But now this program is under threat—a threat that it will run out of money.
And this isn’t a surprise to anyone, except maybe the president:
The officers of the government directly responsible for the program have been telling the government for years that it will run out of money. In fact, I think they started suggesting it in 1996, and they even predicted that it would be 2016 that it would be run out of money, so this shouldn’t be any big surprise.
Outside analysts of the program have been telling the government for years that it will run out of money. The disabled community has been telling the government for years that it will run out of money. Maybe I ought to say that again, it has been predicted.
Suddenly, the president woke up to this fact this year. Perhaps it’s because now we know for sure not just that it will run out of money, but based on his own Treasury Department’s figures the month when it will be broke.
Let me put this as clearly as possible, no waffle words, no Washington word games: by December of next year, the program will be broke.
And once broke, the law governing the program means that benefits for the disabled must be cut, or delayed.
That’s just rotten. But that’s not all the bad news.
Once that fund becomes insolvent, our Congressional budget experts tell us the program will need $352 billion over the next 10 years in order to fully pay disability claims.
For Wyoming, this means that 13,900 disabled people would lose $3 million in benefits. In Vermont, this means that 24,500 disabled people would have their benefits reduced by $5 million. And, Senator Sanders, we represent two of the smaller states. Looking around the Committee hearing room, millions of additional Americans from all our States could see their benefits cut.
In the face of this crisis facing 11 million Americans, what does the president propose to guarantee a robust and enduring program for them and succeeding generations?
He proposes a plan that seems to be something, but actually turns out to be nothing.
Instead of thinking how best to help the disabled by creating a long-term solution that best values them and the program, the president has suggested that all we need to do is shift payroll tax revenue coming in for other programs to cover his shortfall in the disability program.
All this does is pass the buck to another Congress, and another president, after Barack Obama leaves office. We had a president years ago that said “the buck stops here!”, and we need to stop the buck.
President Obama’s transfer plan runs up the debt we owe to pay the retirement benefits social security recipients rely on. We call it a “Trust Fund”. Don’t trust a federal trust fund. There are not dollars stashed away anywhere. There are no dollars in the disability trust fund and there are no dollars in the social security trust fund. More accurately it should be called accounts payable because it is further debt. We spent the money.
Most importantly, it leaves all working Americans and the disabled without certainty about the program and unable to fully live out their ability to live the American dream.
Why do I say that? Well, the ability to tap human potential has changed dramatically since the program was first created in 1956.
According to a recent article in The Economist:
[The Disability Insurance program’s] whole design is antiquated. It presumes that people, once disabled, cannot work. If they do, they usually lose their benefits. Yet lots of people with disabilities can work: wheelchairs did not stop FDR from becoming president or Greg Abbott from becoming governor of Texas.
On behalf of those who use it, we need to modernize the Disability Insurance program.
In the 1950s, when workers were doing manual labor and they experienced a debilitating condition, many times that was it! They could not work anymore.
But the work our constituents do has changed, as our service and knowledge economy has grown significantly during the past six decades.
Thanks to technology, people are also more likely to work from home, have flexible working hours, and even start their own businesses. All of these changes have made it easier for those with disabilities to continue working.
And studies have shown those with disabilities tend to be happier, healthier, and have higher incomes when they’re working.
Unfortunately, as the chart on the screen shows, the disabled today are less likely to earn income from working than ever before.
This is true even after Congress passed the Americans with Disabilities Act of 1990 mandating changes in the workplace intended to facilitate employment for the disabled.
Buried deep in the president’s budget are a few programs that might be a grudging acknowledgement that there is much more to be done to create a disability system that can support the ability of disabled Americans to still contribute to our workforce. I am encouraged by some of the demonstration ideas proposed in the president’s budget to keep those with disabilities in the workforce. However, we need to do more without putting an additional burden on our finances.
We should be working in partnership along with Republicans, Democrats, House and Senate, and the president to provide the long-term security our disabled deserve, and the program finances that fit our balance sheet. Together, we can do better.
To protect the most vulnerable among us, we should all agree that political gamesmanship must not get in the way of our commitment to helping our constituents who need us the most.
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