Unemployed Americans Who Can't Find Work Are Going On Disability To Survive, Further Milking the Entitlement State

The civilian labor force shrank again in April, this time by about 1/2 million workers, remaining below where it stood nearly 3 years ago (Bureau of Labor Statistics). What happened to those people? How are they going to survive, how are they going to eat and have shelter in this terrible economy.

Well, Bippy, not to worry your pretty little head.  Most of these folks are actually ahead of you. They have figured out a solution to the problem. What is their solution? Easy. Just go on Social Security Disability (SSI), which provides a pretty fair income IF YOU CAN GET IT!!. So in April,  guess how many people did that? The answer is: 225,000 workers applied for Social Security disability benefits, and nearly 90,000 were enrolled, according to new data from the Social Security Administration.

So it ain't necessarily easy, buster! 225,000 applied, and 90,000 were accepted, though note that the 90,000 were from previous months' SSI applications. But on average, one out of every 2.5 application is approved to get the Social Security Disability Benefit. so far this year, nearly 1 million workers have applied to get on the disability program, according to the Social Security Administration. More than a third will eventually be enrolled.

The total number of new disability enrollees in the first four months of 2012 is now above 333,000. Add in spouses and dependents, and the number of beneficiaries added to the program so far this year climbs to 539,000. That's about the number of people that dropped out of the labor workforce! Coincidence? No such thing, friend buster. As Investors Business Daily (IBD) reported recently, more than 5 million workers and their families have enrolled in the disability program since President Obama took office. Andb we are down about 5 million jobs since then, too. Grassy knoll coincidence. Zounds.

The Obama administration's economic advisers warned in a report last fall that the mass exodus of workers who can't find a job onto the disability rolls poses a long-term risk to the economy. Once enrolled, they almost never return to the active workforce. This can, the report said, result "in a loss to society of the economic contribution those workers could have made."

We are indeed turning into Europe, and the only question of interest that remains is: Are we beyond the point of no return? Are we doomed to spiral into chaos, just like the Roman empire, or will QE and Monetary Policy, and the ECB, and Germany and Angela Merkel and China, and Brazil, and the Emerging Markets save the world? Hold your breath, Bippy.

Note that the Roman Empire finally succumbed because it could not sustain the debt it incurred, even though they worked hard to avoid disaster, and tried a Roman version of Quantitative Easing (QE). By another name, what they did was the same as what everybody does, which was to print money like crazy and devalue the currency. This continued apace to the point where Christianity finally stepped in and picked up the pieces and foreclosed on the Roman Emprire, seizing all the assets for a song. The Romans were wiped out, and had no choice but to turn into Christians, which then started fresh from scratch. Literally scratch, mind you. Dark ages. Black death. Middle ages. Living the trogolodyte life style large.

So who will foreclose on the US and Europe and China and the rest of the current faltering world order? Who will pick up the pieces and start a new world from scratch? Probably the Islamofascist, aided and abetted and enabled by the Obamafascists, the Sarkozy fascists, the Cameron fascists, and the rest.

 That is the pessimistic view.

On the other hand, it is also possible that the animal spirits, native intelligence, Mark Zuckerberg, the Google twins, the Twitter guys, will survive the crushing onslaught of the SEC, the Fed, the DOJ, the FBI, the CIA, the DoD, and the rest. If so, which is highly doubtful, then possibly creativity, and freedom loving free enterprise may yet seize the day. If so, then we will miraculously grow out of the current disastrous financial sovereign debt crisis. Like the world previously  grew out of the crushing debt of past debt disasters: the Napoleonic Wars, the Civil War, WWI, WWII.

Nice to end on a positive note, what?

More SSDI facts from Bloomberg News:

– The number of workers receiving Social Security Disability Insurance jumped 22 percent to 8.7 million in April from 7.1 million in December 2007, Social Security data show.

– That helps explain as much as one quarter of the decline in the U.S. labor-force participation rate during the period, according to economists at JPMorgan Chase & Co. and Morgan Stanley.

– Disability recipients may account for as much as 0.5 percentage point of the more than 2 point drop since the end of 2007, the economists calculate, and that contribution could grow when some extended unemployment benefits expire at the end of this year.

– More than 99 percent of all SSDI beneficiaries remain in the program until retirement age, David Greenlaw, a managing director in New York at Morgan Stanley, wrote in a March research note, citing government data. The program provides an average of $1,111 in monthly income to eligible workers with a physical or mental impairment that will last at least 12 months or result in death, according to Social Security.

– The number of people collecting disability surged as the economy contracted, with the share of the U.S. population between the ages of 25 and 64 on SSDI climbing to a record-high 5.3 percent in March from 4.5 percent in 2007. Applications per 1,000 working-age people rose to 18 last year from 8 in 1990.

– The program spent $132 billion last year, more than twice as much as in 2000. Once the trust fund dries up, the program’s incoming revenue will be enough to cover only about 80 percent of scheduled benefits, the trustees said.

So more people are disabled and can’t work even as a) the overall health of Americans improves, and b) fewer and fewer jobs require a great deal of physical exertion?

    Economists David Autor at the Massachusetts Institute of Technology in Cambridge and Mark Duggan at the University of Pennsylvania’s Wharton School in Philadelphia says SSDI “appears in practice to function like a nonemployability insurance program for a subset of beneficiaries. Also, less-stringent screening procedures, more attractive benefits and a waning need for less-skilled workers have bolstered SSDI rolls, they said. In addition, “difficult-to-verify disorders,” including muscle pain and mental illness, more easily qualify for SSDI under program reforms, Autor wrote in a 2011 paper.