Disability Insurance for All

Welfare v. Unemployment Chart

Crazy report from This American Life and Planet Money about the rapid rise of disability insurance claims, and how it’s come to replace the federal welfare program in many ways.

A person on welfare costs a state money. That same resident on disability doesn’t cost the state a cent, because the federal government covers the entire bill for people on disability. So states can save money by shifting people from welfare to disability. And the Public Consulting Group (PCG) is glad to help.

PCG is a private company that states pay to comb their welfare rolls and move as many people as possible onto disability. “What we’re offering is to work to identify those folks who have the highest likelihood of meeting disability criteria,” Pat Coakley, who runs PCG’s Social Security Advocacy Management team, told me.

The company has an office in eastern Washington state that’s basically a call center, full of headsetted women in cubicles who make calls all day long to potentially disabled Americans, trying to help them discover and document their disabilities…

This issue seems more complicated than the episode implies, but it is certainly something we should be looking into.

Listen to the teaser, the full episode, read the whole interactive piece Unfit for Work: The startling rise of disability in America, and check out this rebuttal from Media Matters.

That Ain’t Smart, That’s Creepy: Credit Score Edition

Another installment of my ongoing series about technology, privacy and smart phones—That Ain’t Smart, That’s Creepy.

This one’s about how credit agencies are beginning to use social networking data as a criteria for assessing an individual’s credit score…

Applicants who type only in lower-case letters, or entirely in upper case, are less likely to repay loans, other factors being equal, says Douglas Merrill, founder of ZestFinance, an American online lender whose default rate is roughly 40% lower than that of a typical payday lender.

…and other assorted creepiness:

An online bank that opens in America this month will use Facebook data to adjust account holders’ credit-card interest rates. Based in New York, Movenbank will monitor messages on Facebook and cut interest rates for those who talk up the bank to friends. If any join, the referrer’s interest rate will drop further. Rates and fees will also drop if account holders spend prudently. Efforts to define customers “in a richer, deeper fashion” might eventually include raising rates for heavy gamblers, says Brett King, Movenbank’s founder.

Using Social Media to Determine Creditworthiness {the economist; via andrew sullivan}.

How to get Unlimited Frequent Flier Miles

No, this blog has not been hacked by spammers.

As recently as July 1, 2011, an unknown number of travel hackers were ordering thousands of Presidential dollar coins from the U.S. Mint on their frequent flyer credit cards. When the coins arrived, with shipping paid for by the government, the clever travelers returned them to the bank, paid off their credit card, and took a free trip to Hawaii.

“We’ve used them to go on trips around the world,” says Jane Liaw, a 35-year-old public health researcher and science writer in San Francisco. Liaw says she and her husband, who use a variety of tricks for earning miles, are planning trips to Greece and Turkey, “all on miles and points.”

As Planet Money reports, it all started with a failed effort to get Americans to use dollar coins:

In 2005, Congress decided that a new series of dollar coins should be minted to engage the public. These coins would bear the likeness of every former president, starting with George Washington. There would be a new one every quarter. So, far, the Mint has produced coins through the 18th president, Ulysses S. Grant.

The Presidential coins will cost the U.S. Government 16 million dollars by the time it ends in 2016. There are already 1 billion dollar coins locked up in government vaults.

The dollar coin loophole has since been closed; the coins can still be ordered from the Mint website, but the only acceptable form of payment is a debit card or wire transfer.