On Day One, the new Congress launches an attack on Social Security

By Michael HiltzikBusiness Columnist

Jan. 6, 2015 3:22 PM PT

Well, that didn’t take long.

As one of its first orders of business upon convening Tuesday, the Republican House of Representatives approved a rule that will seriously undermine efforts to keep all of Social Security solvent.

The rule hampers an otherwise routine reallocation of Social Security payroll tax income from the old-age program to the disability program. Such a reallocation, in either direction, has taken place 11 times since 1968, according to Kathy Ruffing of the Center on Budget and Policy Priorities.

But it’s especially urgent now, because the disability program’s trust fund is expected to run dry as early as next year. At that point, disability benefits for 11 million beneficiaries would have to be cut 20%. Reallocating the income, however, would keep both the old-age and disability programs solvent until at least 2033, giving Congress plenty of time to assess the programs’ needs and work out a long-term fix.

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The procedural rule enacted by the House Republican caucus prohibits the reallocation unless it’s accompanied by “benefit cuts or tax increases that improve the solvency of the combined trust funds,” as paraphrased by the National Committee to Preserve Social Security and Medicare.

In practical terms, the advocacy committee says, that makes the reallocation impossible; it mandates either benefit cuts across the board, which aren’t politically palatable, or a payroll tax increase, which isn’t palatable to the GOP.

Social Security advocates are almost universally aghast at the change. “It is hard to believe that there is any purpose to this unprecedented change to House rules,” wrote Max Richtman, president of the committee, in an open letter Tuesday, “other than to cut benefits for Americans who have worked hard all their lives, paid into Social Security and rely on their Social Security benefits, including Disability Insurance, in order to survive.”

The rule change reflects the burgeoning demonization of disability recipients, a trend we’ve reported on in the past. it’s been fomented by conservative Republicans and abetted by sloppy reporting by institutions such as NPR and “60 Minutes.”

Disability recipients are easily caricatured as malingering layabouts by politicians, academics and journalists too lazy to do their homework. They’ll say disability benefits are easy to obtain, so lavish they discourage work, and convenient substitutes for welfare payments. None of that is true.

As I reported in 2013, Social Security’s disability standards are stringent. To be eligible you must have worked at least one-fourth of your adult life (typically from age 22 on), and been employed in at least five of the previous 10 years. Children qualify under Supplemental Security Income, and workers younger than 31 have to show employment in half the years since they turned 22.

You have to be too impaired to earn even $1,040 a month on your own. Just over a quarter of all applicants are approved initially, though an additional 13% or so win benefits on appeal. All in all, only 41% of all applicants end up with checks. Sound easy to you?

The new rules drafters say it’s necessary to “protect the Old-Age and Survivors Insurance (OASI) Trust Fund from diversion of its funds to finance a broken Disability Insurance system.” But as Ruffing observes, disability isn’t “broken.” Its rolls have grown because of a number of well-understood factors, including the aging of the American population, the entry of more women into the workforce (and thus their eligibility for benefits), and the increase in Social Security’s full retirement age above 65.

Previous reallocations also have hurt disability’s funding, including a shift from disability toward the old-age program in 1983 and an inadequate shift back in 1994. “If DI’s tax rate had remained at its pre-1983 level,” Ruffing writes, “we wouldn’t need to replenish the fund today.”

Do House Republicans understand any of that? It’s doubtful. If they did, they’d understand that their actions Tuesday are nothing short of shameful. What a way to begin a new Congress.

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