Wednesday, June 26, 2013

Variations on a Theme

I keep looking for new sources of information on the state of the Economy, with mixed results.  I was interested recently to see that Bill Moyers was interviewing the Marxist economist, Richard D. Wolff.  That turned out to be quite a disappointment as he seems to me to be a self-absorbed clown.  There may be a modernized Marxist critique of capitalism that is worth reading, but I don't think it is going to come from Wolff.

I was more pleased to see that there are quite a few columnists worth paying attention to in the Economix blog at the NY Times.  They cover a wide range of economic topics from a variety of viewpoints.  Of course, not all of them offer perspectives that I like.  For instance, Binyamin Appelbaum's article, The Rise of Disability, seems to me to be just another variation of the Romney/Republican 47% story about how the lower classes are ripping off America.

"The share of working-age Americans receiving federal disability payments has roughly doubled in recent decades. It rose from 23 of every 1,000 workers in 1980 to 47 of every 1,000 workers in 2011. Put differently, 5 percent of the potential work force is more or less permanently out of action. That’s not good. 

The government likes to describe the increase mostly as the result of two demographic trends. Americans, on average, are getting older, and old people are less healthy. Also, as more women have entered the labor force, the share of female workers with health problems has climbed closer to the male average.

Independent experts, however, see substantial evidence that disability insurance increasingly serves as a safety net for people who cannot find jobs – people, that is, who might still have the ability to perform at least some kinds of work..."

And, here is his conclusion:

"...As the San Francisco Fed note puts it, disability insurance “is likely to keep expanding unless program rules and incentives are fundamentally altered.”"

First off, Appelbaum implies that the "government view" and that of "independent experts" are somehow mutually exclusive, which is clearly not the case.  More importantly, though, the conclusion he adopts from the San Francisco Fed ignores the implications of the facts which Appelbaum deems most significant.

To rephrase the "Independent Experts" view a bit:  when the economy gets bad, any kind of disability becomes a bigger barrier to employment because of job competition.  Appelbaum's prescription in this situation would be to tighten up eligibility requirements so that it is harder to get the benefits.  This seems to me to be just a variation on the Republican effort to pare away Social Security and other safety net measures.  With the economy in its currently depressed state, what that line of action really means is that you would be taking a bad situation and making it worse by applying inappropriate austerity constraints to the most beaten-down segment of society.  It is the same line of thinking that recognizes that there has been a big increase in the food stamp rolls and then goes on to suggest that the proper response is to make program entry more restrictive.  In short, find the people that are suffering the most in the economy and make their situation worse.

Before any kind of safety net programs get slashed in the name of restructuring, it seems like a more appropriate response given the dismal state of the economy is to first make a serious effort to improve the jobs situation.  A lot of the problems people see with government benefit programs disappear when unemployment goes down.  As is the case with concerns about deficits and debt, the time to identify and tackle real problems with anti-poverty programs is during times of prosperity.

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