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Eric

Finding Common Ground to Fix the Disability Insurance Program

January 10, 2020 by Eric

By: Ted McCann

They say imitation is the sincerest form of flattery, and with Senator Elizabeth Warren’s new plan for individuals with disabilities, she has decided to take a page from House Republicans. Even though it is 5 years after the fact, it is encouraging that Senator Warren has decided to publicly support a program design – a benefit offset – that House Republicans insisted be tested when negotiating the Bipartisan Budget Act of 2015 (BBA15). While we continue to wait for the evaluation of the demonstration project created under BBA15, it is a positive step that leading Democrats are finding common ground with Republicans around the idea of ensuring that individuals on the Disability Insurance (DI) program are able to work to their full ability.

Currently, if an individual is on DI, they enter into a confusing morass of well-intentioned programs designed to help them return to work as soon as they reach the “Trial Work Period” level, or receive earnings above $880 per month in 2020. As the chart below makes clear, trying to understand this morass would be trying for anyone. And, the consequences for an individual on DI making a mistake are dire. If the Agency makes a mistake and provides an overpayment, the individual will have to pay back that overpayment. And, worse, if an individual ends up earning more than what is called the ‘Substantial Gainful Activity’ (SGA) limit, or $1260 per month in 2020, then an individual could no longer be eligible for the DI program, which generally includes health care.

Because of these complex rules and benefit cliffs, individuals on DI are understandably hesitant to return to work. In fact, individuals on the Supplemental Security Income (SSI) program are more likely to work (though at a lower earnings level) than individuals on the DI program. You would expect that individuals who had a work history, that is, individuals on the DI program, would have a higher work likelihood than individuals without a work history, that is, individuals on the SSI program. One key reason for this lies in how these programs are designed: SSI, rather than having a confusing array of work incentive programs, has a ‘benefit offset’ design. For every dollar above a set-aside threshold an individual earns, they lose $.50 in benefits.

What Senator Warren is proposing is to take the SSI program design and port it into the DI program. Fortunately, there is strong agreement across the aisle to do this. In the 2015 Bipartisan Budget Act, then Chairman of the Ways and Means Committee Paul Ryan ensured that the Promoting Opportunity Demonstration project was included, and this demonstration would test how strong a work incentive this program design would be in the DI program. Over 10,000 people have enrolled thus far, and the expectation is that we will see results by June 2021.

It is encouraging that Senator Warren has joined her Republicans colleagues in supporting this program design. While there remain differences between the two – namely, where does one set the threshold to begin the ‘benefit offset’ – disability policy remains an area of great possibility. Individuals with disabilities are ill-served by the current system, which locks them into a life where they all too often have to choose between maintaining access to the DI program, or integrating more broadly into the workforce. Allowing individuals on DI to continue to pursue their American dream should remain an important policy goal for the future.

Filed Under: Blog Tagged With: Promoting Evidence-Based Public Policies

AIF President Ryan calls for advancing free-market principles; countering socialism’s rising popularity among millennials

December 18, 2019 by Eric

Washington, DC – Earlier this week, American Idea Foundation President Paul Ryan joined the American Enterprise Institute’s podcast: Banter, to discuss how capitalism has done more to lift people out of poverty than any other economic system in history. Ryan, who is a distinguished visiting fellow in the practice of public policy at AEI, shared his thoughts on why millennials are attracted to socialism and what can be done to educate them on the perils of this political and economic theory. He also discussed how to address issues like income inequality and poverty.

The full podcast is available here and excerpts of Ryan’s responses follow.

Legislative efforts to expand opportunity and upward mobility:

“There are three laws that I worked to pass in my later years in government, when I was Speaker of the House, that work on these things. One was Opportunity Zones, which is a way of getting private capital into the poorest communities in America to revitalize communities. The second one was something called Social Impact Bonds, which uses private-sector solutions to seek to solve social problems. And then the Evidence Act, which is focused on Evidence-Based Policymaking and opening up the federal poverty programs for analysts to use data and analytics to go with what works best. My point there is it ends up validating that our principles work, that personal responsibility and incentives do matter. And these are new policies we put in place, or that the ink is barely drying on these laws, that I think will take the center-right principles and apply them to the problems of the day and help us get some serious profound results.”

Countering socialism’s rising popularity among younger Americans:

“The current generation has what I would call a very historically ignorant, romantic attachment to socialism. It’s just basic emotions and altruism, that is how I see it…. It’s a soft form of collectivism, so it just seems “cool.” I don’t think [most younger Americans] even really know what it actually is.

“But so, it definitely is in vogue…. We have work to do – and this is what my American Idea Foundation does and this is what I’m working on here at AEI – to make sure that young people have the scales lifted from their eyes so that they can see the perils and the pitfalls of socialism and understand that democratic capitalism, free enterprise, whatever you want to call it, is the best possible tool for upward mobility, for fighting poverty, for human beings that man has ever created….”

**

“Capitalism is the best possible weapon against poverty and for upward mobility than any other system that humans can organize themselves upon.”

**

“I really do believe there is a really good case for very classical liberalism among our nation’s youth. They just don’t quite see it yet. Their own personal experiences and preferences and needs and wants all speak to freedom of choice, free self-determination, and yet, they’re going to vote for politicians who want to deny them those things in all these basic areas? It doesn’t jive. It doesn’t fit.”

On Universal Basic Income:

“I understand the intellectual appeal. I do not support the idea because I think it lacks an aspect of self-worth and self and personal responsibility. I think it lacks a proper incentive structure for people to move themselves up and out in life and to feel that fulfillment in their lives. So, it’s sort of a hollow, materialistic solution to what is a bigger, deeper problem.”

On capitalism growing the economic pie and promoting opportunity for all:

“My elevator pitch on that is. What do you want? Do you want a government designed to promote equality of opportunity, or do you want a government designed to promote equality of outcome?

“These are two very different kinds of governments. Our system is designed for equality of opportunity. A socialist system is designed for equality of outcomes. And my pitch to young people is: When you have to have the government as your centerpiece in life, it has to be the core of everything, and take it from me – someone who spent 25 years in government, 20 of them in elected government – it’s not going to be done so equitably. It’s going to be cronyism, corruption, and, and you’ll have even greater disparity. You’ll have the super-rich, the super-poor, and very little in between. Again, look at countries like Venezuela.

“And so, the best solution to income disparity is more economic wealth, more upward mobility, better education, turn on the escalators of opportunity and of upward mobility. That is how you tackle the wealth gap. You bridge the wealth gap by growing the pie and making sure that everyone can have access to bigger slices of an ever-growing pie, versus trying to have government we distribute slices of a shrinking pie.”

Filed Under: Blog Tagged With: Validating Reforms that Expand Opportunity

Ryan highlights work of Evidence-Based Policymaking Commission at Brookings Institution

December 9, 2019 by Eric

Washington, DC – This morning at a symposium on the “Next Generation of Evidence,” hosted by the Brookings Institution, former Speaker Paul Ryan shared his thoughts on the Evidence-Based Policymaking Commission, recognizing the work of Co-Chairs Ron Haskins and Katherine Abraham and highlighting the work of the American Idea Foundation to expand opportunity.

Excerpts of Speaker Ryan’s remarks follow.

On the Evolution of Data and the Success of the Evidence Based Policymaking Commission:

“A few years back, we were getting frustrated in Congress about the lack of evidence in policymaking. Then, we were kind of getting stuck in ideological arguments on how best to fix problems and fight poverty through programs that were already implemented because we had very little data to prove what was working and what was not working. We saw what happened when we actually had measurements, and we felt that was the future. So, we decided to form a commission and I recached over to a friend of mine, Patty Murray, to work on legislation that ultimately got passed.”

**

“[The Evidence Based Policymaking Commission] is a commission that actually produced a very good report, and we put much of their recommendations into law and so, all I want to say is that I salute the next generation that is assembled here today to promote evidence-based policymaking. This is the future, the sort of R&D factory for effective policy that we were envisioning. And as a former politician – or as a recovering politician, I should say – this work helps leapfrog partisan, ideological arguments and helps us get to what works: Where is the evidence? How do we make a difference? How do we effectively steward taxpayer dollars? And so, I’m very excited about what you’re all doing. I’m very excited about the next generation of evidence-based policymaking, and I’m very excited that Ron and Catherine Abraham, on behalf of the commission, are going to receive this award.”

How the American Idea Foundation will utilize Data and evidence:

“In my vocational portfolio, there are three things that I am doing: I am working on these issues at AEI, I have my foundation, and I also teach college at Notre Dame. I work with a department there called LEO, the Lab of Economic Opportunity, and we’re doing RCT’s with different charities and it was one of the economists there who gave me the idea of the commission.”

**

“What I have learned in my travels across the country and learning about this space was that there really wasn’t a good connector of the grassroots poverty fighters on the ground — who are well-meaning and hard-working, but don’t have access to capital or to academics. They want to do RCT’s and help people but don’t really have access to the other side so that is what the American Idea Foundation is basically going to be. It’s going to be a connector to try and connect all these pieces so that we can have poverty solutions that are proven and effective, and that can be scalable and replicated.

A Role for Government and Civil Society in Expanding Opportunity:

“I think there’s a huge space for civil society and philanthropy and the private sector to play. Absolutely. They’re going to try some innovative ideas that may not be right for government at the moment, and that’s where philanthropy can come in and show programs that actually work and are effective. Philanthropy is probably the key piece of all of this because it can finance programs that work.

“But I also think now, with that next generation coming up in evidence-based policymaking, it is going to be so much easier to move the needle on poverty and to scale programs that are effective. I think that’s going to inform public policymakers, so that public policy is not going in the wrong direction but in the same direction.”

**

“There’s going to be clearly a role for government. [It will be] more of a supply line role, than a frontline role…. What I do not think should be done is one [government] replacing the other [civil society]. I think they should come with each other.”

Filed Under: Blog Tagged With: Validating Reforms that Expand Opportunity

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