Unemployment Numbers Scam

Arnold Ahlert is a former NY Post op-ed columnist currently contributing to JewishWorldReview.com, HumanEvents.com and CanadaFreePress.com. He may be reached at atahlert@comcast.net.


Pages: 1 2

When the jobs data were released last week, it was revealed that only 115,000 new jobs were created, well below the 165,000 predicted by the media-anointed economic “experts,” and significantly below the 125,000 jobs-per-month pace required just to keep pace with the number of people entering the work force. Yet in an apparent paradox, the unemployment rate dropped from 8.2 percent to 8.1 percent. Presumptive Republican presidential candidate Mitt Romney explains half of it. “There is something about that 8.1 percent figure you ought to know,” he told a crowd at a town hall-style meeting in Cleveland yesterday. “You might assume that that number came down from 10 percent to 8.1 percent because of all the jobs that were created, and that assumption would be wrong. The reason that percent came down was because of all the people that dropped out of the workforce.”

Mr. Romney is correct. Much of the lower number is indeed attributable to the fact that 342,000 Americans gave up looking for work, and those people are no longer counted as being unemployed. Yet there is another, far more ominous element to the paradox that is part of the equation as well: the number of Americans receiving Social Security Disability Insurance (SSDI) has soared.

Since 2010, and directly coinciding with the time millions of Americans used up their 99 weeks of unemployment insurance, disability claims have risen by 2.2 million. And precisely like Americans who have given up looking for work, those receiving disability payments are neither counted as part of the workforce, or part of the unemployed. The rise in the number of claims is daunting. From December 2007 to April 2012, the number of workers receiving SSDI jumped 22 percent, from 7.1 million Americans to 8.7 million. According to economists at JPMorgan Chase & Co. and Morgan Stanley, that figure explains as much as one quarter of the decline in the labor force participation rate.

“How we measure and understand what’s going on in the economy can be influenced by the degree to which various public-support programs are available and being used,” said Michael Feroli, chief U.S. economist at JPMorgan in New York. “With a rising number of disability beneficiaries, there are both lower unemployment rates and lower participation rates.”

That’s an understatement. The latest drop in labor force participation, from 63.8 percent in March to 63.6 percent in April, represents the lowest rate since 1981–fully 31 years ago.

The Obama administration’s “solution” to the problem? “Workers on SSDI rarely return to the labor force, resulting in a loss to society of the economic contribution those workers could have made,” said a report written in December 2011 by the National Economic Council, Domestic Policy Council, Labor Department and President’s Council of Economic Advisers. “Thus, keeping the long-term unemployed in the labor force should be a priority.” Congress, undoubtedly influenced by election year politics obliged. In February, unemployment benefits were extended through the end of 2012 as part of the Middle Class Tax Relief and Job Creation Act. That move was likely buttressed by research from David Greenlaw, a managing director in New York at Morgan Stanley. In March, he noted that more than 99 percent of all SSDI beneficiaries remain in the program until retirement age.

In other words, give people a temporary extension in unemployment compensation, or they might go on the dole permanently.

A 2006 research paper written by MIT economist David Autor and Mark Duggan at the University of Pennsylvania’s Wharton School in Philadelphia gets to the nub of the problem. SSDI “appears in practice to function like a nonemployability insurance program for a subset of beneficiaries,” they wrote. Less-stringent screening procedures, more attractive benefits and a waning need for less-skilled workers have bolstered SSDI rolls, they added.

Autor followed up that report with one written in 2011, in which he contended that while the “SSDI program is a central component of the U.S. social safety net, it suffers from two substantial ailments that limit its effectiveness and threaten its long-term viability. First, the program is ineffective in assisting the vast majority of workers with less severe disabilities to reach their employment potential or to earn their own way. In fact, the program provides strong incentives to applicants and beneficiaries to remain out of the labor force permanently, and it provides no incentive to employers to implement cost-effective accommodations that would enable disabled employees to remain on the job….Second, the program’s expenditures are extremely high and growing rapidly.”

Pages: 1 2

  • pierce

    It is funny, but it is not funny, we the people are being scammed buy our own government with considerable help from the main stream media, and why, because the media has refused to expose the truths about the useless, stupid attempts our President and his Czars are throwing at us. Does the media think we the people are that dumb, I for one am beginning to think so. Four more years of stupid policies we can not afford. Wake up America WAKE UP.

    • John C. Davidson

      Excellant analysis, sir. When we combine all the different expositions on very level, our faith in government is no longer viable.

  • StephenD

    IT is a way of life for a number of people. Shortly after reaching adulthood they are coached as to how to get the "Crazy Check" or the WIC program checks or some other sort of "assistance" check…simply, "other peoples money" that the rest of us pay for. We all can point to areas we're familar with and see the disproportion in the numbers of folks working for a living and those taking a chunck out of Free America.
    Like Margaret Thatcher said, "Socialism is well and good until you run out of other people's money."

  • John C. Davidson

    This has obviosly gone on way too long. We now have a government that spends more time covering up their own illegal activities whereupon, nothing else gets done.

  • fiddler

    TERM LIMITS, TERM LIMITS, TERM LIMITS! It's too much about getting re-elected and not enough about serving! Too much about my political career and not enough about living under the laws I create. Who cares about debt as long as I can over-use my power to tax and never be held accountable for poor stewardship of the taxpayers' money!

    • Amused

      Terrn Limits ? LOLOLOL ,,,,in your dreams man !! Who do you think are the ones who would write that into law ?

      • WilliamJamesWard

        The night time mob at the gate with the torches and pitchforks………or maybe a Constitutional
        Convention after November or at a time the people remove professional politicians and
        the positions go to registered tax payers who are 50 years old or older. Having worked
        their lives they can be drafted into the Congress for two or three years and then sent back
        home. Limited government, return to the Constitution………in my dreams yes……….William

  • Amused

    Talk about unemployment scams , just the other day on your boy Rush Limbaugh's show , a caller suggested that listeners file "unemployment claims " even though they don't have a reason to , being retired or students etc , to drive up the unemployment claims before the election . And Rush , the cough , cough" honest dude" that he is {NOT } told the listener it sounded like a good idea , he did however qualify that actual claims do not raise unemployment figures , but Rush being Rush said go for it . What do you call that ?

  • Amused

    ….not to mention, another leading economist stated the loss of labor force participatiuon has a lot to do with loss gto offshore jobs , which btw may come back due to ever rising labor costs in China alot sooner than anyone thinks . LOL….maybe even before November . LOL…what a disaster eh repocons ?

  • H&R_ Barack

    Damn Scam:
    ….does anyone wonder how many lottery players are supported by taxpayer-funded, Supplemental Nutrition Assistance Programs (SNAP), and freebie Electronic Benefit Transfers (EBT) ?

    OH! WAIT! America's 5th generation, Obama-voter welfare queens DO have disposible income

    ………OUR TAXES' provide them with disposable transfer accounts!

    I feel better already.

  • Alex

    about HALF of "working age" adults are NOT working.
    Unemployment is more than 20% and growing every day.
    We cannot drill, and some news:
    "Obama’s State Department is giving away seven strategic, resource-laden Alaskan islands to the Russians.
    .Yes, to the Putin regime in the Kremlin." from WDN

    • Amused

      Yea cannot drill . Exxon made 400 Billion last year . A new refinery costs 4 billion . So instead of maybe building a refinery in one of the upper Nort states , thereby taking care of the entire NW , Exxon wants a pipeline to its refineries in the Gulf , why ? so its closer to export points and higher markets ,thereby keeping the price of gas artificially high . You people are blind . Not to mention gullible to a fault .

      • WilliamJamesWard

        You see a valid problem, we are being raped at the pump. Who enables Exxon to get away with
        their sucking the life out of America along with other energy moguls? It is the Government and
        the Government will not issue permits to build adequate numbers of refineries to process the
        plentiful oil America has. We are under a Government that causes the problem and enriches
        foreign entities that I think we can assume give hidden kickbacks to those who can be
        bought. Maybe if we could eliminate everyone that is in Government and go to other people,
        and monitor finances big time we could go back to a time of sufficiency and productive lives.
        Wiliam

  • crypticguise

    Speaking "plainly" most of these new SSDI Claims are pure bulls*it. It a RIPOFF of American workers who pay taxes of COSMIC proportions. Time to cull these "disabled" people and put them to work sweeping the streets if necesssary, and monitoring them closely.

  • WilliamJamesWard

    Considering the tank the employment figures are in and that most of my life I have had to
    work two jobs and for a short time three and that just to make ends meet. I am troubled to
    see married men and women unemployed, jobs disappearing faster than any are being
    created. Government spending money it does not have, indebting us for generations
    while declaring itself above the myriad of laws on the books that no one understands
    or can count. Courts that convolute and stretch out and bend right and wrong into what
    defys understanding. As we suffer financial depression and want is it any consolation
    that the political frauds and disingenuous leaders will loose the golder goose and be
    headed to a great fall. I am aware of people that are capable of taking care of our
    financial mistakes and people that can make things streamlined and well running,
    but who will cleans the moral character of the people that have caused the mess we
    live in and will continue to be burdened with as long as they are with us, I guess that
    is us and November is where there must be a turnaround………………William

  • JohnMichael

    If Crazy money" plays out because of this and similar revealing articles, another SSDI scam is already underway. It is called simply "the sugars." As any of you who have a friend who works at Social Security can surely tell you, streams of innercity patrons are showing up with the complaint: "I've got the sugars." It's clear the applicant has no medical problem and no idea what he (or more usually she) is talking about but is aware that Obama money is available. "The sugars" is the latest scam to elicit undeserved money. It refers to the medical condition of diabetes

  • Amused

    Ward , there won't be any turn around in November , no matter who wins …..that is the illusion of the American Politik . Tax cuts for the Big Corporations , favorable legislation such as that which ALEC has been bribing and lobbying the politicians with for years , never had the intention of creating jobs , but only to increase profits . That's why jobs have gone offshore , indeed much of the profits . "Trickle Down Economics " was nothing but a myth , just another illusion , perpetrated by bought and sold politicians . Why do you think Reagan not only raised taxes 8 times , spent more and actually increased government by 20 % . This great mythical King of Conservatism was doing nothing less than what all the Repocons of today are railing and whining about !

    • WilliamJamesWard

      If what you say playes out and this time next year nothing has changed I will post from
      some assylum with crazy aunt Emma, if allowed to continue breathing by the masters of
      America, which I doubt……………………………William

  • Amused

    One here says "crazy money " ? Indeed , for the Fed.Govt .visa-vis Congress has raided SS funds to the tune of ONE TRILLION DOLLARS in I.O.U.s .
    Why is it then that Obama the great nemesis of Repo Cons did EXACTLY what Bush did ……BAILOUTS .Both did nothing to make Wall Street honest , for they're up to their same old tricks again .What will the next big economy busting game be that will be played ?
    The housing collapse was only a symptom of something much worse , something NO ONE talks about and few know .It is the main reason States , cities , banks and brokerage houses went bust an bankrupt . And it still exists . It is THE reason why interest rates have remained low and will most likely remain so for several years . It is the reason why both Bush and Obama knew that yes , there were Corporation that were too big to allow to fall .

    • WilliamJamesWard

      Considering my theory that the banks and the government create circumstances to bust the
      economy every thirty years, take America in forclosure or pick up closed businesses for
      pennies on the dollar and sell America back to the inhabitants. It is a cycle of feed off of
      the people who are no more than herd cattle, shorn and culled to satisfy the elite's appetites.
      Few figure it out and fewer see life as they expect, so what's next on the plate? Maybe we
      will see, I can at least hope for real change where the people get rid of the rotten politicians.
      William

  • Amused

    While everyones porfolios grew fat , Wall Street got even richer , FannyMae and other mortgage brokers profits went through the roof , and all the greedy pigs were at the feeding troff in a frenzy , the boys on Wall Street were busy inventing "new products " they could get rich quick on , with nary a thought for tommorrow , America or anything else . These are called DERIVATIVES and SWAPS , a devious type of GAMBLERS INSURANCE , which evaded requirements of Liquidity , by not exactly calling themselves Insurance Companys. Greenspan knew and kept his mouth shut , why ? because it became so monstrously big , that all one could do was to hope it wouldn't explode on their watch . Everyone jumped on board including State and Private , Pension Funds ,Banks even cities in other counntries. Similar to Enrons game , but infinitely larger and even more dangerous .

  • Amused

    It was like sending a drunken sailor with the fortunes of nations into a Casino , and placing bets on his wins AND his losses , while selling insurance against his losses WITHOUT the money to back up paying for those losses .Well the gamblers lost , Investors around the Globe lost . What was the amount of loss ? Estimates vary between $100 TRILLION and $147 TRILLION ! What is the exposure to these losses ? Virtually all of the major investment banks and commercial banks . The low interest rates are buying them time , for should interest rates climb expsure increases exponentially AIG WAS INDEED TOO BIG TO FALL ..So dont be fooled , there is only a very limited road to travel in order to get out of this mess , and both Romney and Obama know it .Aside from the bluster , nothing will change in November , except maybe either of the two parties can claim to be "king of the hill " . And all that will do is make party members feel better about themselves .

  • Amused

    AIG's bailout was necessarry , it was too big to fail . For the extent of the losses were so great , no one cares to speak about it , and few know the true figures involved . For this reason interest rates were lowered and will remain so for several years .And Neither Obama nor Romney can remedy it , no matter what they bluster in their campaigns . If Romney wins all the REPOCONS and TEAPARTY members will claim victory , because that will make them feel as if they have control and their ideology has won out .But in reality Romney if he wins will have to do exactly what Obama has done . If interest rates climb the exposure to many ofv the largest Investment Banks , Commercial Banks and Brokerage Houses will increase exponentially , for these losses are estimated to be between $100 TRILLION and $147 TRILLION

    • WilliamJamesWard

      I will send them a check, stop turning me into a cynic……………..William

      • WilliamJamesWard

        Come to think of it I can write a check for a $147,000,000,000,000.00 and it should not bounce
        as it would be as good as the Governments any day…………………William

  • Amused

    I hate to say it Ward , but I'm already a cynic . BIG MONEY , not big buisiness , nor big govt.nor Republican nor Democrat runs this country . Elections are part of the illusion , social issues , moral issues are just side shows .No one dares interfere with the great Casino- Wall Street . Offshore money , tax evasion for lack of a better word is written into our laws , Banks and credit card companies doing whatever the hell they want , whenever they want are written into our banking laws . I have to laugh when people call Social Security a "Ponzi scheme " , for it is the least of our economic problems , and that is so due more lobbied laws allowing jobs to leave our shores .The people who wrote SS into law were a helluva lot smarter and more honest than the disgusting whores we have as politicians today . Of course SS is in trouble , when Companies layoff thousands to boost shareholder profits ,not because of finacial woes , produce their products in factories shifted offshore , it is INEVITABLE , that contibutions to SS are going to be less and retirees are growing at [for now ] a slightly faster rate ..

  • Amused

    The local denizens here like to criticize Social Security , it's the whipping boy of the Right . The people who wrote it into law were dmarter and more honet than the politico's we have today on both sides of the isle . Organizations like ALEC and their lot have legislated laws favorable to moving buisiness , profits , manufactuuring and jobs OFFSHORE . Phony headquarters in the Caymans , Ireland and Switzerland , they're all LEGAL and all Legislated by the MONEY men of America . It's not Big govt. It's the enormous amounts of moneyt that fuels the Wall Street Casino .Social Security is Insurance , a Pension , funded by contributions of the employed .How can such a fund be balanced when Legislation allows big Money to sell off jobs , manufacturing , to foreign lands . Who are you people kidding ? Social Security can be fixed , quite easily , but first you have to get rid of a DO NOTHING CONGRESS which cannot even agree on what day it is ?

  • Amused

    Hey Admin . are you censoring anything that doesn't agree with your views on S.S. ? You disallowed my last dstaement which contained NOTHING that violates rules or even automatic censors . What's up with that ?

  • Amused

    Yet you allow mr.bean to denigrate Blacks with his Amos and Andy routine . ????

  • Amused

    WHY , does Romney have his riches offshore ? And WHY does he have a Swiss Bank account . Sure …it's legal , it was lobbied by people just like him and the politicians that legislated the laws were bought and paid for by the lobbies . But is THAT American . Does it reflect our "alleged values " ?

  • Amused

    Big Money knows how to manipulate the masses , abortion , social and religious issues ,along with criticism of SS and SSD are all red herrings .The ILLUSION of "winning in November " is just that , an ILLUSION . Personally I do hope Romney wins , it will be a learning experience for the deluded . Most here think Soros is a wooooo "pupet master " he's small change compared to the Big money calling the shots .

    • WilliamJamesWard

      Yes the left and right have sold America out for their purposes but come together as the
      clawed hands of the beast that has us by the throat and is choking the life out of us.
      You a cynic……….Noooooooooooooooooooooooooooooo!!!!!!!!!!!! outrageous as you
      can be sometimes you state what I see and believe, may the Almighty help me……..William

  • Fred Dawes

    we now have real unempoyment of 18 percent this time next yr its going to be 30 percent and most people working will not care, it is a dead country just waiting for the ideals of germany 1933 and the murder of millions in the U.S Camp system and like the good german the good american will not care.