The Declining Work and Welfare of People with Disabilities

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The premise of this book is that while the Americans with Disabilities Act (1990) removed obstacles to employment for people with disabilities, the welfare system reduced work incentives and led to increased dependency on government transfers. The two principal government programs are Social Security Disability Insurance and Social Security Insurance for adults and children. The former is an insurance program for working individuals who become disabled; the latter, a means-tested income support program. Burkhauser (Cornell Univ.) and Daly (Federal Reserve Bank of San Francisco) use the Current Population Survey to provide empirical evidence for their conclusions. A brief data section at the end describes the statistical analysis. Using time series for the last 20 years, the authors conclude that employment of those with disabilities has declined; incomes have fallen relative to the rest of the population; and more disabled individuals have come to depend on government assistance. Changes they recommend include greater reliance on state implementation of programs; moving to a more insurance-based type program like that of the Netherlands; and "experience rating" employers when disabled workers are laid off or terminated. A major caveat is that in today's economy with jobs so scarce, the emphasis on work may be of little help. Summing Up: Recommended. Upper-division undergraduate through professional collections. * CHOICE * 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 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, Brookings Institution