<!doctype html public "-//W3C//DTD W3 HTML//EN"> <html><head><style type="text/css"></style><title>RE: Concord Coalition?</title></head><body> <blockquote type="cite" cite>Michael wrote<br> <br> I'm bet not directly (it's not a consensus builder), but he might well<br> have written something terrible indirectly.  Most SS privatizers ignore<br> both the transition costs and the disability program, because when those<br> figures are entered back in, their proposals look barbarian.</blockquote> <div><br> <br> </div> <div>I wrote something for Znet on Bush Social Security and disability a while back, here is an excerpt:</div> <div><font face="Verdana" size="-4" color="#000000">"...the Bush plan would usher in. The GAO report said that "income from the individual accounts was not sufficient to compensate for the decline in the insurance benefits that disabled beneficiaries would receive" under the major reform proposals.</font><font size="-4" color="#000000"><br> <br> <font face="Verdana">This is because disabled persons typically have shorter work histories and would have less time to accumulate money in their accounts.</font><br> <br> <font face="Verdana">Private investment of Social Security dollars may work for someone who has a solid and steady income for 40-plus years (provided the market doesn't go south -- there are LONG periods when the stock market does not increase at all or actually declines, then there are individual bad investments), but what happens to people who enter the Social Security rolls earlier in life due to disability? Limited personal investments based on a truncated work history will be inadequate to cover living expenses for the rest of one's life.</font><br> <br> <font face="Verdana">Social Security disability is broad and inclusive because it is a universalized approach which is not a part of the commodities market. Not being market-based, it does not have the draw backs of private insurance which sells disability policies as a "product" and must make a profit from the sale. The insurance industry first studies data and calculates rates that will assure profits. It is not a generous process, it is not a just process, rather it is a capitalist game where the "winners" are the companies which get the highest returns possible.  A disabled person can pay an extremely high price for minimum or limited coverage which still may subjected to a challenge by the insurer upon making a claim.</font><br> <br> <font face="Verdana">Not that there are not procedural problems with the administration of Social Security disability, but a worker's FICA tax, by contrast, buys not only retirement benefits but disability benefits and survivor's benefits if the worker dies leaving dependents. </font><br> <br> <font face="Verdana">As attorney Harriet Johnson explains "The comparisons of private investment to Social Security leave these other benefits out of the equation.  While we might do better investing our FICA tax privately so far as age-65 retirement is concerned, when we factor in disability and survivor coverage, there is nothing in the private market for anyone -- at any age, any level of health -- to get the level of income protection they get from Social Security for what they pay in FICA."</font><br> <br> <font face="Verdana">During the 20s-40s, insurance companies experimented with offering disability benefits and failed miserably.  Edward Berkowitz illustrates how private insurers tried to squeeze profits from disability insurance in his Twentieth Century Fund study, Disabled Policy:</font><br> <br> <font face="Verdana">"They [insurance companies] tightened the definition of disability, lengthened the waiting period before a disabled person could begin to receive benefits, refused to sell policies to women, and restricted benefits to those who became disabled under the age of fifty-five. In other words, they offered limited protection and attempted to take only the very best risks. Even so, they lost money."</font><br> <br> <font face="Verdana">In New York, New Jersey, Puerto Rico and Rhode Island, workers are covered by private disability insurance through their employers, who are required by law to provide *temporary* coverage. Employers in many other states voluntarily provide disability; to some extent, it takes pressure off them to continue extended sick pay.  The period of disability covered by an employer's policy, however, may be as short as a month or two. Some employers, and many other groups, offer participation in supplemental disability plans, which can also be purchased on an individual basis.  The three main types of supplemental disability insurance products are:</font></font></div> <div><font size="-4" color="#000000"><br> <font face="Verdana">Noncancellable, which continues to protect you as long as you continue to pay premiums; benefits may increase with income;</font><br> <br> <font face="Verdana">Guaranteed renewable, which only guarantees the availability of coverage but not the premium amount; and</font><br> <br> <font face="Verdana">Optionally renewable, which is analogous to term insurance in the sense that each year you and the insurer consider a new contract with new terms.</font></font><br> <font size="-4" color="#000000"></font></div> <div><font face="Verdana" size="-4" color="#000000">Almost all plans are premised on one having a certain amount of savings tucked away for a rainy day. They are expensive to buy and can prove hard to collect on a claim.  Insurers, in general have relied on shifting costs of permanent disability onto the Social Security system rather than taking the responsibility for providing guaranteed universal disability coverage.</font><font size="-4" color="#000000">"</font><br> <font size="-4" color="#000000"></font></div> <div><font face="Verdana" size="-4" color="#000000">snip</font><br> </div> <blockquote type="cite" cite><br> Doug once interviewed a woman who had a great spiel on this. She was<br> mainly concentrating on the downside of SS privatization for women, but<br> she addressed the disability insurance subject directly. Doug, can you</blockquote> <blockquote type="cite" cite>remember who I'm thinking of?</blockquote> <div><br></div> <div>Doug??<br> </div> <blockquote type="cite" cite><br> Also, Martha, you might try fishing around in the New York Review of Books</blockquote> <blockquote type="cite" cite>archives.  Peterson wrote several very long articles for them in the past</blockquote> <blockquote type="cite" cite>few decades.</blockquote> <blockquote type="cite" cite><br></blockquote> <blockquote type="cite" cite><br></blockquote> <div><br></div> <div>Yep will do.</div> <div>thanks Michael.</div> <div>marta</div> <x-sigsep><pre>-- </pre></x-sigsep> <div>Marta Russell<br> Los Angeles, CA<br> http://www.disweb.org</div> </body> </html>