Early Retirement Extreme Forums

http://www.thisamericanlife.org/radio-a ... h-benefits
1 in 4 people are officially disabled in some counties in the U.S. The number of people on disability doubled in the last fifteen years. 250,000 people apply for disability every month. The number of people on disability with back pain in Alabama has doubled in the past ten years.
Free healthcare. Income indexed to inflation. For life.

It's interesting that this is happening to a higher degree in Red states (obviously, still happening in Blue states just slightly less when compared via tax dollars paid to tax dollars received).
Definitely needs to be reformed. Though, I bet in my lifetime we get to a point where we have to change the economic model that suggests 99% of people willing to work can find a job. We have really just begun moving our industries to becoming ultra efficient. We already have a robot that can do delicate and complex tasks at the cost of a chinese worker. Only a matter of time before the cost of the robot drops further. There are plenty of other trends heading this way.

A Danish politician recently made a language blooper (some int. meeting), because the [almost] direct translation of what corresponds to disability insurance in the Danish language actually is "early retirement". This blooper was subsequently analyzed by various professors and language experts in the national media. The US concept of early retirement simply does not exist in the Danish mind.
Fixing the "let those work who want to and give the rest a living wage" is a huge cultural problem because we're morally still in the agricultural age in terms of effort/reward. There's no way of knowing how the system would react to "free lunch". Even if we could presently afford it (by e.g. slashing the military budget), would the rest of productivity simply break down?
How much would people really work if they really didn't have to? What's the distribution?
You can see some of the cultural differences in terms of how Europeans prioritize more vacation time and shorter work weeks relative to Americans who prioritize more income.

"How much would people really work if they really didn't have to? What's the distribution?"
I think the old Soviet Union or Mao's China showed that. A system that pays people even when they don't (want to) work inevitably needs so much tax money that it removes the incentive for people who naturally would like to work hard.

I had no idea it was this bad. In the interview the doctor says that he frequently has patients come to him with back pain that makes it hard for them to stand all day to do their jobs. He determines that they are disabled because they have little education and few job prospects in that particular town. He actually asks them the last grade they finished in school. There are no sitting jobs in town so he considers them unable to work at all. I think he might be confused as to what "disabled" means. Perhaps someone should disable his license.

How it works is that all you have to do is to find a sympathetic social/caseworker who's oblivious to the principal agent problem (of where the money comes from) or like in many government budgets HAS to allocate all the budgeted money at the end of the year. In that case, you just won the welfare lottery.
Alternatively, you might get assigned a tougher caseworker (or someone who just ran out of budget) in which case, the bar is set higher---sometimes even ridiculously high (think bureaucratic obstacles or various humiliating 'activation' programs). Of course case workers get reassigned, so the party can end/begin at any time.
As a result, some people get welfare for practically no reason at all (like the example above... I know [of] a couple of similar ones.) while some who are more deserving might have a hard time at it.

+1 to what FFJeff said. That reporter needs to get out of her neighborhood a little more to get some perspective. I couldn't believe how shocked she was that there were towns where the only jobs for non-college graduates were labor-intensive jobs. In the second segment, she was surprised that people were afraid to give up their disability checks because they might not find stable work.
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What is that doctor supposed to do? Suppose you're a doctor who's treated an auto plant worker and his family for 20+ years. You know the guy is hard working and hasn't tried to work the system for most of his life. Then the plant closes and the guy is too old to find another job where he lives. He only needs 10 years of assistance to get to social securtiy. Would you help him out?
To be clear, I don't support most of these programs. I think they just mask other problems that the government doesn't want to deal with. If I worked in that kind of position though, it would be hard to turn someone down for assistance--especially when you know so many other people get it. I wouldn't have the stomach for it.

In any case there are certainly examples of people who mine the system for a small income and then works under the table (so as not to lose the welfare) on the side. I guess this kind of entrepreneurial spirit could be described as evil-ERE.
Also plenty of examples of people who refuse jobs because the marginal income of taking the job and losing the benefits vs just staying on benefits is ridiculously low. The EITC (earned income tax credit) works the same way to discourage work when income is already very low. It's similar to when high earners complain and say they'll work less to avoid higher tax brackets... but at the other end of the income scale.
It's often said that taxes are progressive (with the exception of payroll), but if you consider the various credits or benefits at the low end, the highest effective taxes are actually paid in the middle. Both at the lowest and the highest incomes, the tax/benefit system discourages further work.

It's interesting that this is happening to a higher degree in Red states
Red states also tend to be the more obese states. And the top diagnosis is back pain... coincidence?

SSA receives more disability applications for back pain than any other medical condition...in all 50 states.
What's more interesting is that states that have more people on government programs would vote against their own self interest and vote republican.

Red/blue is pretty specious for this, it's not hard to find a few million individuals of the non-dominant party... Besides, many if not most don't walk the talk:

https://www.nytimes.com/2012/02/12/us/e ... on-it.html

Jenny, yes, I would turn him down if I were the doctor.
I've mentioned several times here that I believe the worst thing someone can do when preparing for early retirement is to plan to do nothing. Going from productive to unproductive can be devastating. An early retiree who doesn't want to become an alcoholic or an Opraholic must have some interest that will fill their time.
Disability is enforced nothing. You are not permitted to find a new career because if you do you lose the free money and benefits. You cannot experiment. You cannot try. You cannot move. You have to shut off.
The kindest thing the doctor could do for the guy is make him change, move, learn, retrain, adapt. By giving him disability the doctor is enabling him to do nothing when he reached a dead end in the maze. Getting that guy to turn around and find a new route is not only good for all of us, it is good for the guy too.

Actually, it isn't all that easy to get SSI disability in my experience. My friend's husband had a serious traumatic brain injury (brain surgery/ICU/3 months in rehab). He did well at first, but 10 years later developed early-onset dementia as a consequence. When he finally became unsafe to leave at home unsupervised while she worked, she applied for SSI for him. It took two tries and a considerable lawyer's fee to get him through the process and approved, even though his dementia was quite severe by that point (as in, lighting the kitchen on fire).

I'm on Ego's side here. I'm not giving the guy disability. Move, reeducate yourself, etc. Tons of low skill jobs in the Dakotas.
"What's more interesting is that states that have more people on government programs would vote against their own self interest and vote republican."
Always surprises me too.

A lot of people under 65 with a terminal illness are going to be eligible for disability.
I wonder if the increased trend are baby boomers getting ill before 65.

Lazy dirt bags who suck off the rest of us.....That's who most of them are....
Now I'm sure SecretWealth will preach to me and explain how they are all victims of a cruel world.

More on this issue:
http://www.zerohedge.com/news/2013-03-2 ... nimum-wage
This issue is the sort of thing that REALLY gets under my skin as a taxpayer. I want to do everything I can to help people who are truly disabled. I have NO desire for my family to be taxed to pay for other people to go ERE.

@tylerrr: I'm afraid this may be a prime example of "don't hate the player, hate the game."
This game needs to go away.

Man, you guys are harsh
I completely agree from a macro perspective that those programs are bloated and rigged and should go away. The bit about state governments hiring firms to get people onto disability drove me nuts.
I just think on a personal level it must be hard for people to turn other people away. I can easily see rationalizing it--it's only a few people, everyone else is doing it, etc. Plus, if that doctor doesn't get the guy on disability and the guy gets sick, the doctor will end up paying for part of the guy's medical bills. I don't think that's fair either.

@jennypenny:
Plus, if that doctor doesn't get the guy on disability and the guy gets sick, the doctor will end up paying for part of the guy's medical bills. I don't think that's fair either.

You certainly have a point there. I suppose with some people we all end up paying either way. Some people cannot be induced to work with either carrots or sticks, and in those cases, either we pay now in taxes or we pay later in some form of coercion or crime.