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What Went Wrong and a Strategy for Change
View related content: Economics
In this provocative volume, Richard V. Burkhauser and Mary C. Daly argue that the U.S. disability system is failing–growing at an unsustainable pace for taxpayers and delivering relatively poor outcomes to those with disabilities. These outcomes are not the inevitable results of demographic or health changes but rather the unintended consequences of changes to two public programs designed to assist those with disabilities: Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI).
Drawing on lessons from two recent policy initiatives–the reform of U.S. welfare policy and the reform of Dutch disability policy–and analyzing how public insurance and welfare program incentives affect behavior, Burkhauser and Daly argue for fundamental changes in the way disability is insured and managed. In keeping with the Americans with Disabilities Act’s philosophy of encouraging people with disabilities to remain in the workforce, the authors recommend changes in SSDI and SSI that make work, rather than benefits, the primary goal of federal disability policy.
If implemented, these changes will both bend the future cost curves for these programs and increase the employment, income, and independence of working-age people with disabilities.
Richard V. Burkhauser is an adjunct scholar at AEI.
Praise for The Declining Work and Welfare of People with Disabilities
“The incentives in U.S. disability programs encourage nonwork. As shown by this brilliantly argued volume, the result has been that a rapidly growing percentage of those with work-inhibiting conditions are drawing disability or welfare benefits rather than working. This in turn increases public spending and causes the income of those with such conditions to stagnate. The authors discuss several policies that could save public dollars and improve both the work effort and income of those with work-inhibiting conditions. This well balanced yet forceful book represents the wave of the future in U.S. social policy because the unsustainable federal deficit is forcing policymakers to find ways to reduce public spending and increase self sufficiency.”
–Ron Haskins, senior fellow, economic studies, and co-director, Center on Children and Families, Brookings Institution
“Burkhauser and Daly provide a trenchant diagnosis of what ails the U.S. disability system and offer an ambitious framework for reform. Their analysis of the U.S. disability system’s maladies is grounded in decades of solid scholarship, and their proposed improvements are illuminated by relevant examples and precedents–most notably, the unprecedented reforms to the Dutch disability system that recently reversed its unsustainable trajectory. With the projected exhaustion of the U.S. Disability Insurance Trust Fund less than a decade away, this book could not be more timely.”
–David Autor, professor and associate chair, department of economics, Massachusetts Institute of Technology
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